If you have been put into the position of needing to file for bankruptcy, you are likely not to be very happy about it, but it does not lead to your life ending. Bankruptcy exists in order to provide you with a fresh start. Continue ahead to learn how you can smooth out the bankruptcy process so it’s not a financial disaster.
Exhaust every other option before making the decision to file for personal bankruptcy. You have other options available like consumer credit counselling services. Bankruptcy stays on your credit for a whole decade, so if there are less drastic options that will solve your credit problems, it is in your best interest to make use of them.
When you feel certain that you must file for personal bankruptcy, refrain from squandering your life savings to pay off unsecured debt. You should not use your retirement savings unless the situation calls for it. 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.
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. 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.
When looking for a lawyer to handle your bankruptcy claim, the best way to go is off of a personal recommendation instead of simply flipping through the phone book. To handle your bankruptcy, you need a trusted attorney, not a shady one that is out to take your money.
Stay positive. If you file for bankruptcy, you might be able to reclaim certain property that has been repossessed, such as your car, electronics or jewelry. You may be able to recover repossessed property if the repossession occurred fewer than 90 days ago. Consult with a lawyer who can advise you on what you need to do to file a petition.
Don’t be afraid to remind your lawyer about important aspects of your case. Lawyers are people too, and sometimes they forget important information and need to be reminded. Speak up, because it is your future on the line.
Determine if bankruptcy is necessary. You may find consolidating your debt may be simpler. Bankruptcy is a long process that can be stressful. You will have trouble getting credit down the line. Needless to say, if some alternative strategy will allow you to take care of your debts, you should give it a try before resorting to bankruptcy.
Initial Filing
Once the initial filing period is over, ensure that you are getting out and enjoying life. It can be several months between the initial filing and the final discharge of debts. That stress could lead to complete depression, if you do not take the necessary steps to fight it. Life will get better; you just need to make it through the bankruptcy process.
Be sure you know how Chapter 7 and Chapter 13 differ. Chapter 7 eliminates all debts. This type of bankruptcy ends any relationship you might have with creditors. But, with Chapter 13, you will be in repayment plan for about 5 years prior to any debts you have being totally dissolved. In order to choose the right bankruptcy option, you need to know the differences between these kinds of personal bankruptcy filings.
Your trustee may be able to help you secure an auto loan or get a mortgage even though you have filed Chapter 13. However, the process of approval is a bit more stringent. Your trustee must approve any new loans such as this. You will need to come up with a budget and show that this new loan payment schedule is doable. You will always have to let them know why this item needs to be purchased.
Make sure you act at an appropriate time. When it comes to filing for bankruptcy, your timing is important. Sometimes, it is good to file immediately, but sometimes it is smarter to wait until you have passed through the worst of things. Speak with a bankruptcy lawyer to discuss the proper timing for you to file bankruptcy.
If you are about to file for bankruptcy, you have probably been through tough times lately. But, that does not mean that your post-bankruptcy life cannot be fantastic. Bankruptcy is not the end. Follow the tips given here in order to make it a new beginning.
If you are making more money than you owe, bankruptcy should not even be an option. Although you may see bankruptcy as a free pass to eliminate your debt, if you can slowly whittle away at your debt with your income, it will be much better than killing your credit score with a bankruptcy filing.