Although going through bankruptcy can be very hard, it is sometimes necessary. It’s best to make the decision of filing for personal bankruptcy after doing a little research and gaining a clear understanding of the topic. Read the below article for excellent advice from people who have personally went through bankruptcy.
If you are feeling like you are seriously going to have to file for bankruptcy then do not clear out your savings. Do not tap retirement accounts unless there is no other alternative. You may need to use some of your savings; however, you should not use all of your savings. Remember that you must safeguard your future financial security.
It is important that you increase your knowledge on personal bankruptcy by reviewing websites that provide reliable information. The United States Justice Department, the ABI (American Bankruptcy Institute), as well as the NABCA (National Assoc. Consumer Bankruptcy Attorneys) are excellent sources of 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.
One of the most important things to remember when filing for bankruptcy is to be honest and truthful every step of the way. To avoid problems, penalties and future re-filing bans, resist the urge to hide documentation or assets.
Although you can find many bankruptcy attorneys listed in your local Yellow Pages or online, it’s best if you can find one through the personal recommendation of a friend, family member or acquaintance. 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.
If you’re filing for bankruptcy soon, be sure you are going to hire a lawyer. Bankruptcy is a complex process, and you probably don’t know all the information that is required to navigate it. A lawyer that specializes in bankruptcy can make sure you are following the correct procedures in your filing.
Do not pay your taxes with credit cards that will be canceled when you file for bankruptcy. In most states, this is not dischargeable debt. Therefore, you will end up owing the IRS a lot of money. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
Investigate your other alternatives before you decide you have to go with bankruptcy. Consolidating current debt could make it easier to manage. Going through a bankruptcy is a long and stressful process. Your future credit will be affected by these actions. Because of this, filing for bankruptcy should only be used as a last resort.
Talk to an attorney about reducing your car payments so that you can keep your vehicle. Sometimes, as part of the bankruptcy filing, your auto loan can be restructured so that you pay less each month. If you meet the criteria specific to your state, it may be a good option to consider.
It is possible to get an auto loan or mortgage during the repayment period for Chapter 13 bankruptcy. This is a lot harder. You will be required to meet a trustee and be approved for a new loan. Create a budget and prove that you will be able to afford it. You should also be prepared to explain why you need to purchase the item.
Be certain you are making the right choice before you file for bankruptcy. Look into credit counseling to see if it could help you work out of your debt without bankruptcy. Bankruptcy will leave a permanent scar on your credit report and before you take this huge step, you should search through every available option first, to help try and limit the damage to your credit.
Declaring bankruptcy is not something most people aspire to, but can be unavoidable. If you read through the information above, you’ve gathered a little bit of insight provided by other people who have had to deal with bankruptcy. You will find this experience less difficult knowing that others have done it before you and survived by following these tips.