Being in debt can be extremely stressful. It constantly builds, going from a molehill to a mountain in very little time. Sadly, it is not as easy to fix it once you get there. In some situations, filing for bankruptcy might be the best option.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. In many areas of the country, this debt will not be dischargeable, and you could be left owing a significant amount to the IRS. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. So using your credit card to pay off your tax obligations, then filing for bankruptcy, can actually hurt you instead of help you.
Once a person’s debts outstrip his or her ability to repay them, bankruptcy may be the only option left. If you find yourself going through this, you should know all about the laws that are in your state. Different states have different laws regarding bankruptcy. For instance, some states protect you from losing your home in a bankruptcy, but others do not. Do you research about legal ins and outs in your state before you begin the bankruptcy process.
Never shirk on the truth in your petition for bankruptcy. Remember that if you hide your valuable assets or income from your bankruptcy trustee, you may risk a number of penalties and complications. Among these is the possibility that you could be blocked from ever filing again.
Unsecured Credit
After you have declared bankruptcy, you may have a hard time being approved for unsecured credit. In this event, you should attempt to apply for a secured card or two. This will show people that you are serious about getting your credit record back in order. Eventually, you could be able to obtain unsecured credit.
Don’t hesitate to give your attorney a heads-up about something she has missed. Inaccurate or incomplete information can lead to your petition being denied. Speak up if something is troubling you, as this is your future we are talking about here.
Prior to filing for bankruptcy, determine which assets, if any, are exempt from being seized. The Bankruptcy Code contains a list of various assets that are excluded from bankruptcy. It’s crucial to read that list before filing to see which of your prized possessions can be seized. This will ensure that you do not have any surprises once you have filed bankruptcy.
Never give up. If you file for bankruptcy, you might be able to reclaim certain property that has been repossessed, such as your car, electronics or jewelry. If the property you own has been repossessed under 90 days before the bankruptcy filing, you may still be able to get it back. Speak with your attorney about filing the correct petition to get your property back.
Before you file, make sure you understand current bankruptcy laws. Bankruptcy law evolves constantly, and it’s important to stay up-to-date to ensure that you file properly. Your state’s legislative offices or website will have up-to-date information about these changes.
Prior to putting in the bankruptcy paperwork, determine what assets are protected from seizure. The Bankruptcy Code contains a list of various assets that are excluded from bankruptcy. You need to read the exemptions for your state, so you know what property you can protect. While it might not be possible to protect a particularly beloved possession, at least you will know in advance whether or not you risk losing it.
Many bankruptcy lawyers offer free consultations, so go to several before choosing one. Make sure you meet with a licensed attorney rather than a paralegal or assistant, because it is illegal for these people to give legal advice. Searching for the best lawyer will help you located the comfort you need during this time.
It is acceptable to find yourself overwhelmed and turn to bankruptcy to get out of trouble. The above article has provided you with advice to allow you to handle your finances and deal with the option of bankruptcy. Use the advice that you have been given to make some changes in your life.