Deciding to file for bankruptcy is a major life step. It’s a tool designed to give you a fresh start, but the process is governed by strict federal laws and Local Bankruptcy Court rules. When you’re feeling the weight of mounting debt, it’s easy to make impulsive decisions that you think are helping your situation, but in reality, they could lead to your case being dismissed: or worse, accusations of fraud.
At the Law Office of Andrew H. Griffin, III, APC, we’ve been helping neighbors in Southern California navigate these waters since 1983. As both a licensed attorney and a California-licensed real estate broker, Andrew Griffin provides a unique "broker-attorney advantage" that is especially critical when your home or property is on the line.
If you’re feeling overwhelmed, remember: you don’t have to do this alone. You can text your way to debt relief by reaching out to us 24/7. But before you take another step, let’s look at the seven most common mistakes we see people make when preparing for a bankruptcy filing.
1. Are You Transferring Assets to Family or Friends?
It’s a common impulse. You know you’re going to file for bankruptcy, and you’re worried the court will take your car, your boat, or a piece of land you own. You decide to "sell" it to your brother for $1.00 or simply sign the title over to a friend "just until the bankruptcy is over."
In the legal world, this is known as a fraudulent transfer.
The bankruptcy trustee assigned to your case will look back at your financial history: often up to two years (and sometimes longer under California law). If they see you moved an asset out of your name for less than its fair market value, they have the power to "avoid" that transfer. This means they can actually sue your friend or family member to take the asset back. Instead of protecting the item, you’ve now dragged a loved one into a legal battle.
2. Are You Repaying Personal Loans to Family First?
You might feel a moral obligation to pay back your parents or a close friend before you stop paying the "big banks." While that sentiment is understandable, the court views it as a preferential payment.
Bankruptcy is built on the principle of fairness to all creditors. If you pay back $5,000 to your aunt right before filing, the trustee may view that as unfair to your other creditors. Much like asset transfers, the trustee can sue your relative to get that money back so it can be distributed "fairly." Always talk to a bankruptcy lawyer before making any large payments to anyone in the months leading up to your filing.
3. Are You Using Your Credit Cards Right Before Filing?
If you know you’re going to file for bankruptcy and wipe out your debt, it might be tempting to use your credit cards one last time for a vacation, a new TV, or even just to cover daily expenses. Don't do it.
Using credit cards when you have no intention or ability to pay the money back is considered fraudulent intent. Specifically, luxury purchases of more than $800 made within 90 days of filing, or cash advances totaling more than $1,100 within 70 days of filing, are presumed to be non-dischargeable. This means you’ll still owe that money even after your bankruptcy case is finished.
4. Are You Failing to Disclose All Your Assets?
When you fill out your bankruptcy petition, you are signing it under penalty of perjury. You must list everything you own. This includes:
- Expected tax refunds.
- Potential personal injury claims or lawsuits where you are the plaintiff.
- Inheritances you might receive in the next six months.
- Cryptocurrency or "hidden" digital assets.
Many people leave things off because they think the item is "worthless." However, it’s not up to you to determine the value: it’s up to the court. Hiding assets is a federal crime and is the fastest way to get your case dismissed and find yourself facing a bankruptcy attorney in San Diego in a much more stressful setting.
5. Are You Choosing the Wrong Chapter?
The choice between Chapter 7 and Chapter 13 is one of the most important decisions you’ll make.
- Chapter 7 is a liquidation that wipes out most unsecured debt quickly.
- Chapter 13 is a reorganization where you pay back a portion of your debt over 3 to 5 years.
Choosing the wrong one without a professional "Means Test" analysis can be disastrous. If you make too much money for a Chapter 7 but file anyway, the court will dismiss your case. Conversely, if you need to save your home from foreclosure, a Chapter 7 might not give you the time you need, whereas a Chapter 13 could be the perfect solution. As a bankruptcy attorney in San Diego County, Andrew Griffin uses his 40+ years of experience to ensure you’re in the right lane from day one.
6. Are You Hiding Cash or "Under the Table" Income?
Whether it’s a side hustle, cash tips, or "under the table" work, all income must be reported. The bankruptcy trustee will compare your bank statements, tax returns, and pay stubs. If the numbers don’t add up: for instance, if your lifestyle expenses are way higher than your reported income: it will raise a red flag. Being honest about your income is the only way to ensure your debt relief goes through smoothly.
7. Are You Trying to DIY the Process?
Filing "pro se" (without an attorney) is extremely risky. The Southern District of California has very specific local rules, forms, and deadlines. One missed signature or a late filing of your credit counseling certificate can result in your case being closed without a discharge.
Furthermore, a "DIY" filing often fails to take full advantage of California’s generous bankruptcy exemptions. You could end up losing property that an experienced attorney could have helped you keep.
Text your way to debt relief by reaching out to our team 24/7.
Notes for Business Owners
If you are a business owner in Southern California considering bankruptcy, the stakes are even higher. Common mistakes include commingling personal and business funds right before filing or failing to properly value business inventory and equipment. Because Andrew Griffin is also a real estate broker, he can provide sophisticated valuations for commercial leases and business-owned real estate that a standard bankruptcy lawyer might overlook.
Why the Broker-Attorney Advantage Matters
When you file for bankruptcy in San Diego, your home is often your biggest asset and your biggest concern. Because Andrew H. Griffin, III is both an attorney and a real estate broker, he understands the market value of your property better than most. He can accurately apply exemptions to protect your equity and, if necessary, navigate complex foreclosure defense strategies that combine legal maneuvers with real estate expertise.
Get Started with a Trusted San Diego Bankruptcy Attorney
Mistakes in a bankruptcy filing stay on your record and can cost you thousands of dollars: or your home. Since 1983, our firm has provided bilingual (English and Spanish) legal services to the San Diego community, helping thousands of people find the financial peace of mind they deserve.
Don't let a simple mistake ruin your chance at a fresh start. Whether you’re dealing with divorce and debt, or simply fell behind due to medical bills or job loss, we are here to help.
Text your way to debt relief. We are accessible 24/7 via text to answer your urgent questions and get your case moving in the right direction.
Contact Us Today:
- Phone: 619 853-3009
- Contact Online: https://www.andrewgriffinlawoffice.com/contact/
- Visit Us: Law Office of Andrew H. Griffin, III, APC
