When should I file bankruptcy?

The answer depends on the status of your dischargeable debts and the nature of your non—exempt assets. It is not wise to file bankruptcy if you are likely to incur sizeable new debts in the near future. For example, if you or a member of your family are in bad health and have incurred huge medical bills, it would be wise to wait until the illness or injury is cured, or until you have obtained adequate insurance coverage, before filing bankruptcy. It will be at least eight years before you can file a chapter 7 bankruptcy again and it will do you little good to discharge, say $20,000 in medical bills by filing now, and then incur another $40,000 bills in the next few months. It would be better to wait a few months, let your situation stabilize, then decide if it is necessary for you to file.  Having said that you cannot incur debt that you know you will never pay - this is fraud.  There is a fine line here that you need to discuss with experienced bankruptcy lawyer.

Under the bankruptcy law, all non-exempt property that becomes yours by inheritance, life insurance, or divorce within six months after the date that you file bankruptcy must be turned over to the Trustee. Therefore, if you anticipate acquiring any property or money during the next six months by inheritance, as the beneficiary of a life insurance policy or death insurance plan, or through a divorce, you should not file now.  These are issues that you must discuss with your attorney before taking any legal action.

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