Deciding to file a bankruptcy petition is quite significant and should be done carefully and deliberately. Digest the information contained herein, so that you are aware of what you can expect and you know what actions to take prior to making that critical decision. Learn as much as you can beforehand.
Be sure everything is clear to you about personal bankruptcy via looking at websites on the subject. The United States D.O.J., the A.B.I and the N.A.C.B.A. are all useful organizations willing to provide educational material. Knowing as much as possible about bankruptcy gives you an advantage and will help you make the best decision possible.
Before making the decision to file for bankruptcy, be sure to do some research and learn all you can about the subject. There are many websites available that offer this information. The United States Some valuable resources include the U.S. Dept of Justice and American Bankruptcy Institute. The more knowledgeable you are, the more you can be sure that you are making the right decision and that you are taking the right steps to ensure your personal bankruptcy goes as smoothly as possible.
If you are thinking about paying off your tax obligations with a credit card and then filing bankruptcy, think again. Generally, this type of debt is not covered by bankruptcy filing, and you will still have a large debt owing to the IRS. The rule here is that if you can get the tax discharged then you can get the debt discharged. So as you can see, in this situation there is no need to use the card when the debt will be discharged when you file for bankruptcy.
Credit History
Before you file for bankruptcy, carefully consider if it is the right option for you. You can find services like counseling for credit that consumers can use. Bankruptcy leaves a permanent mark on your credit history, so before you take such a large step, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
Before filling for bankruptcy, determine which assets will be exempted from seizure. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. It is vital that you completely understand which assets are protected and which assets can be seized prior to filing bankruptcy. If you don’t read it, you could have nasty surprises pop up later due to your prized possessions being seized.
If filing bankruptcy is in your future, don’t waste any savings you may have attempting to pay off your debts. You should not use your retirement savings unless the situation calls for it. While dipping into your savings is likely to be necessary, avoid wiping it out completely to prevent leaving yourself with little financial security in the future.
The best way to build your credit up after a bankruptcy is making all your payments on time. If you find that to be the situation, consider requesting secured cards. They offer you the chance to demonstrate the seriousness with which you now take your financial obligations. After using a secured card for a certain amount of time, you might be offered an unsecured card once again.
Try going to a personally recommended bankruptcy lawyer instead of using a phone book or the Internet. You want your bankruptcy to go smoothly, and the Internet is rife with fly-by-night companies whose only goal is to prey upon the financially desperate.
It is important to understand clearly the benefits of a Chapter 7 or 13 bankruptcy. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. Go to a specialized lawyer to ask your questions and get some useful advice on what to do.
Don’t try to hide anything if you are filing for bankruptcy, as this will hurt you in the long run. The professional that helps you file for bankruptcy has to have a complete and accurate picture of your financial condition. Be completely honest in your paperwork to avoid a situation that may end in severe punishment.
Chapter 13
Do some research to find out more about Chapter 13 and Chapter 7. Chapter 7 is the best option to erase your debts for good. Your responsibilities to your creditors will be satisfied. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. Take the time to learn more about these different options so you can make the best decision possible.
If you’re concerned about the details of keeping your car, try to ask your attorney about details regarding lowering your monthly payments. You can often lower your payment using Chapter 7 bankruptcy. You must have bought the car 910 or more days before you filed, the loan must have a high interest rate, and you have to have a secure and steady working history in order for that to work.
Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. Investigate the benefits and pitfalls of both. Online resources may be able to provide all the information you need. Once you have done your own research, be sure to review your findings with your lawyer, who is the expert. This way, you can be sure of making a well informed choice.
Remember to spend some quality time with your loved ones. The process for bankruptcy can be hard. It takes a long time, it can be stressful, and people feel unworthy, guilty and ashamed. Most people adopt a very negative attitude toward bankruptcy. However, this isolation will just make you feel worse, and it could cause you to be depressed. Make it a point to catch yourself if you feel yourself pulling away from others. Tell others that you would like to do some enjoyable things together while you go through bankruptcy process, then do it.
Reducing Interest Rates
A great tip to remember if you have filed for Chapter 13 is that you will still be able to receive a loan, so you shouldn’t refrain from trying. It is much harder. Before you can take out a new loan, you will have to clear it with your trustee. Draw a budget up and show how you can pay the newer loan payment. It will also be necessary to show why a new purchase needs to be made.
Before declaring bankruptcy, see if there’s anything less drastic you can do to repair your credit. A lawyer that specializes in bankruptcy law can help advise you of other options, such as repayment plans and reducing interest rates to relieve some of the burden. You can apply for a modification of your mortgage if your home is going into foreclosure. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. Above all else, what creditors want is to get their money. Sometimes they would rather settle for a repayment plan instead of a debtor who is bankrupt.
Once the initial filing period is over, ensure that you are getting out and enjoying life. Many people who undergo this process become way too stressed out. If you let the stress get to you you may get depressed if you’re not doing the proper things to fight it. Once the process is complete your life will improve.
As you’ve read, bankruptcy isn’t as simple as it might sound. By going through the process correctly, the outcome will be further in your favor than it might otherwise have been. By using the tips in this article, you will be able to successfully file for bankruptcy and begin to rebuild your life.
Take a look at all of your financial options before filing for personal bankruptcy. One option to consider is credit counseling. There are a number of companies that will assist you, many of which are non-profit. They can help you to lower both your debts and interest owed to creditors. You pay the organization, and they pay creditors for you.