Filing for bankruptcy is not a fun thing to do. Many people feel embarrassed or ashamed if they have to tell other people that they are bankrupt. Read this article to learn more about bankruptcy and make the best decision.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. Remember that if you can discharge the tax you can discharge the debt. So, there’s no reason to make use of a credit cards if it will not be discharged in bankruptcy.
Visit web sites and read information to learn as much as possible about the topic of personal bankruptcy. The US Run a quick Internet search to find out all the different agencies you should be contacting or visiting via the web to find out what you can. Knowing as much as possible about bankruptcy gives you an advantage and will help you make the best decision possible.
Personal Bankruptcies
If you are considering filing for bankruptcy you definitely need to hire an attorney. Personal bankruptcies are detailed and complex processes, and you may miss something that costs you money. An attorney specializing in personal bankruptcies can assist and make certain things are being handled correctly.
Since the majority of attorneys are willing to provide no-cost initial consultations, it is smart to meet with more than one before you make a selection. Ask to speak with the licensed attorney and not a representative, who can not offer legitimate legal counsel. Comparing different lawyers makes it possible to find one with whom you work well.
Try to get a bankruptcy lawyer that your friends recommend, as opposed to someone that you find from the Internet or yellow pages. There are so many dime-a-dozen companies out there who make it a practice of preying on financial desperation. You need to make sure your bankruptcy goes smoothly, so find someone you know you can trust.
Chapter 13
You could see about filing for Chapter 13 personal bankruptcy. You are eligible for filing bankruptcy under Chapter 13 if you work and owe less than $250,000. Filing a Chapter 13 will let you keep personal items and real estate while you pay down your debt in a consolidation plan. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. However, if you were to miss a payment, the court would dismiss your case right away.
If your income exceeds your obligations, you should not seek bankruptcy protection. While bankruptcy may seem like an easy way out of having to pay back all of the debt that you owe, it is a stain that will remain on your credit report for seven to ten years.
If you are planning to file for bankruptcy, be sure to learn what types of assets you will be able to keep and which can be seized. Certain assets, as listed in the local bankruptcy regulations, are immune from seizure during bankruptcy. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. If you aren’t aware of this, you could lose some assets that you value.
Look at all the alternatives to bankruptcy before filing. You might be able to address your debts by arranging a repayment plan or a reduction in your interest rates. Get professional advice on these matters from a bankruptcy lawyer. A plan that can be useful when foreclosure is looming is a loan modification. Your particular loan holders can provide a lot of assistance if you’re just willing to speak with them. You can negotiate lower rates, longer terms, and other means of repayment that may keep you from having to file a claim. Most creditors will be willing to work out an option to avoid not getting paid at all.
Understand the rights you have as a bankruptcy filer. Don’t take a debt collectors word for it simply because they tell you that you can’t have many or all of your debts erased by bankruptcy. However, there are few debts that cannot be eliminated, like student loans and child support payments. If a collector tries to convince you that some other type of debt, such as a credit card, is non-discharagable, get the company’s information and send a report to your state attorney general’s office.
Facing bankruptcy is not a fun situation and cause a lot of stress and anxiety. If you want to protect yourself from stress, see to it that you hire a good attorney. Don’t think that the highest priced attorney is the best. What you need is a thoroughly competent lawyer, and this does not imply that you have to pay through the nose. Ask people who have used a bankruptcy lawyer for referrals, look them up at your local Better Business Bureau, then schedule free consultations in order to interview them. You could also sneak into court to watch a real live bankruptcy proceeding to see how that attorney handles the situation.
Be honest when filing for bankruptcy. Don’t hide liabilities or assets, as they’ll come back and haunt you. All of your financial information, be it positive or negative, must be disclosed to those in charge of filing your case. They need to know it all. Keeping secrets or trying to outsmart everyone is not a wise move.
Before filing for bankruptcy, you must be educated on the specifics of all bankruptcy laws. For instance, somebody cannot transfer assets from a filer’s name up to a year after they file. It’s also prohibted to run up debt on credit cards just prior to filing.
Realize that bankruptcy, ultimately, might be better for your credit than continuing to make late payments or miss payments on your debt. While bankruptcy may appear in your credit report, you could surely try to fix your damaged credit. This is why people call bankruptcy a fresh start.
Many people who have filed for bankruptcy, resolve to never use credit or credit cards again. This is not wise because you need to rebuild a good credit file. If you don’t ever use credit, your credit history will not improve, and you may not be able to purchase important things like a home and car. Get one credit card and use it wisely to get on the right path.
Never give up. Many times you can get repossess property back once bankruptcy has been filed. You should be able to get your possessions back if they have been taken away from you within 90 days before you filed for bankruptcy. Speak with your attorney about filing the correct petition to get your property back.
There is no need to rush to file for bankruptcy. The information contained in this article can help you to avoid having to file for bankruptcy. Apply what you’ve learned here to make changes in your life that will not hurt your credit.