Frustration, sadness, anguish and anger are feelings that are felt by anyone who experiences personal bankruptcy. Many live with the constant fear of being unable to repay their debts while also maintaining a decent standard of living. You are never truly stuck — there are always options that you can pursue that may include filing personal bankruptcy; keep reading for more information.
Learn as much as you can about bankruptcy by going to informational websites. Many sites, including the U.S. Department of Justice and American Bankruptcy Institute are both sites that provide free advice. The more you know, the better prepared you will be to make the best decisions and ensure that your bankruptcy goes smoothly.
Do not even think about paying your taxes with credit and petitioning for bankruptcy right after. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. It is pointless to use credit cards if they can be discharged.
Make sure you are always providing honest documentation whenever you have to file for personal bankruptcy. Don’t hide income or assets from your lawyer or the bankruptcy trustee or you may find yourself in legal trouble.
When it comes to informing your attorney about your case, don’t be fearful. Inaccurate or incomplete information can lead to your petition being denied. All information submitted to the court with your signature needs to be double checked.
Look for a bankruptcy lawyer that comes from a personal recommendation instead of someone random on the Internet or in the yellow pages. To handle your bankruptcy, you need a trusted attorney, not a shady one that is out to take your money.
Be warned that after your bankruptcy, you may stand out as a leper to credit institutions. You may be unable to get a simple credit card. If you find that to be the situation, consider requesting secured cards. Using a secured card not only helps to rebuild your credit, but it also keeps you from going more in debt with credit card bills. When you have done well with secured cards for a while, you should be able to obtain an unsecured credit card.
Prior to filing for bankruptcy, determine which assets, if any, are exempt from being seized. The federal statutes covering bankruptcy can tell you exactly which assets are exempt from forfeiture to pay off creditors. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. Failure to do this could cause some ugly surprises down the road when you discover that your valuables must be seized.
Never pay for a consult with a bankruptcy lawyer, and ask plenty of questions. Most lawyers will meet with you for free and give you helpful advice, so meet with several. Make your decision after all of your questions have been answered. It is not necessary to make a final decision right away. So, this gives you plenty of time to consult with several attorneys.
Think carefully about your different options before filing for bankruptcy. For example, consumer credit counseling programs can help you by renegotiating your debts with your creditors into payments that you can afford. It is also possible to do your own debt negotiations; however, be sure to get everything in writing.
There are two different kinds of personal bankruptcy you can file for: Chapter 7 and Chapter 13. Get a good grasp of the pluses and minuses each type of filing involves by researching both of them extensively. Do not hesitate to have your lawyer explain any details that seem difficult to grasp. This will help ensure you make the right choice when filing.
If you are going to be filing for bankruptcy, think about filing Chapter 13. Chapter 13 bankruptcy is a good choice for people whose unsecured debts amount to lower than $250,000 and who receive a regular income. This allows you to keep possession of your real estate and property and repay your debt through a debt plan. This plan normally lasts from three to five years, in which you’ll be discharged from unsecured debt. Remember that if you even miss one payment that’s due under this plan, the court could dismiss the whole case.
It is important to know how Chapter 7 filings differ from Chapter 13 filings. By researching each type, you can begin to understand which method is right for you. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.
Before you choose Chapter 7 bankruptcy, think about what effect that is going to have on any co-signers you have, which are usually close relatives and friends. Speak to an attorney or read the bankruptcy laws in your state to find out if certain loans can be excluded from your filing. But, bear in mind, the debt now becomes the sole responsibility of your co-debtor.
It is important to file bankruptcy before its too late. Some people will just ignore their outstanding debts, hoping that someone or something will come and save them, but this never ends well. Debt can snowball very fast, and by ignoring it, you increase the chances of worse problems, such as foreclosure and wage garnishments. When you make the connection that your debt level is too high, contact an attorney that specializes in bankruptcy as soon as possible, to see what can be done.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. For instance, you are not allowed to move assets from your name to someone else’s for a year before you file. Not only that, but the filer cannot lawfully accrue additional debt just prior to filing.
Chapter 13 bankruptcy might be a good option, so don’t overlook it. You are eligible for filing bankruptcy under Chapter 13 if you work and owe less than $250,000. Chapter 13 bankruptcy permits you to remain the owner of your properties, while allowing you to repay your debt using a debt consolidation loan. The plan is usually for a term of three to five years, and a discharge will be granted at the end of that term. Just ensure that you take necessary precautions, as missing one payment can result in the court dismissing your case.
There are a lot of things to consider prior to filing for bankruptcy. You might want to look into the possibility of credit counseling instead. You can get the help you need from a variety of non-profit credit counseling companies. They will work with your creditors to get your payments lowered and your interest lowered as wll. Often, they make the payments to your creditors, and you make your payment to them.
It is possible that a bankruptcy might actually be smarter over the long term than struggling month to month with consistently late or missing payments. While bankruptcy will show up in you credit file for the next 10 years, you can begin the process of making your credit situation better right away. The main benefit to filing for bankruptcy is the chance at a new start.
If your income exceeds your obligations, you should not seek bankruptcy protection. Bankruptcy may appear like the easier way to avoid paying your old bills, but it is a huge mark on your credit score and remains there for up to 10 years.
You now have some great advice, thanks to the information shared here. You should now understand that you have options when it comes to bankruptcy. It can be daunting, but you can do it. Stick with the information presented here and over time you will be able to slowly crawl out from under the mountain of debt you have accumulated.