Filing for bankruptcy can be relieving and stressful, all at once. On one side, you will need to handle a lot of people looking into your personal finances. By contrast, once your bankruptcy is complete, you will have the freedom to rebuild your credit without being hounded by debt collectors. Keep reading for a few smart suggestions for making bankruptcy a smoother process.
Learn as much as you can about bankruptcy by going to informational websites. The U.S. Department of Justice, NACBA, and American Bankruptcy Institute websites are all great places to go for up-to-date information. As with everything in life, the more you know about filing a claim, the better off you’ll be. You can properly prepare when you know what you’re preparing for.
Always be honest with the information you give about your finances. Do not hide any income or assets or go on a spending spree before filing for bankruptcy: the court will find out and will not have a positive opinion of you.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. Remember that if you can discharge the tax you can discharge the debt. Because of this, transferring the debt to your credit card is pointless.
If you are going through a bankruptcy do not fall victim to guilt and pay off debts that you do not need to pay. No matter what you do, do not touch your personal savings unless there is no other option. If you do have to dig into your savings, make sure that you leave enough to sustain you and your family for a couple of months.
Unsecured Credit
Once the bankruptcy is complete, you may find it difficult to receive unsecured credit. If this happens to you, think about applying for a couple of secured credit cards. You can exhibit your desire to rebuild your credit this way. In time, it may be possible for you to obtain unsecured cards.
You may still have trouble receiving any unsecured credit after a bankruptcy. This being the case, look at secured card options. This will be a demonstration of the seriousness with which you view rebuilding your credit rating. After a time, you are going to be able to have unsecured credit cards too.
Before filling for bankruptcy, determine which assets will be exempted from seizure. The kinds of assets which may be exempted during bankruptcy proceedings are listed 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.
Don’t pay for an attorney consultation and ask him or her anything you want to know. It is a good idea to consult several attorney before deciding on one. Make a choice only if you have received good answers to all the questions and concerns you brought to the table. There is no need to feel rushed to decide to file after you talk with your bankruptcy lawyer. Consulting with several attorneys will also help you find someone you trust.
Try going to a personally recommended bankruptcy lawyer instead of using a phone book or the Internet. There are a number of companies who may take advantage of your situation, so always work with someone that is trustworthy.
Chapter 7
Be certain to grasp the distinction between Chapter 7 and Chapter 13 bankruptcy cases. In Chapter 7 bankruptcy, your debts are all eliminated. All happenings with creditors will disappear. In a Chapter 13, though, you’ll be put on a payment plan for up to 60 months before being free of your debts. You need to determine which type of bankruptcy is right for you given your unique financial situation.
There are pros and cons to filing bankruptcy. Regardless of your reason for filing, be aware information is the closest friend you have during the entire thing. After reading the tips we present here, you will be able to manage your bankruptcy filing with ease. Apply all of the knowledge you have gained from this article and you will be on your way to feeling more at ease about your bankruptcy.
Investigate any new laws before deciding to file a bankruptcy. These laws change regularly and you should stay up-to-date so you can make the best decisions. Review the state legislature web site or contact the state legislature office to keep abreast of changes in the law.