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. The whole point is to wipe the slate clean and have a new chance at life. Learn how to make bankruptcy work for you, instead of allowing it to devastate your life.
When bankruptcy seem inevitable it is important not to use your retirement funds or emergency savings to pay creditors. Leave your retirement accounts untouched unless there is absolutely no other alternative. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
Ask yourself if filing for bankruptcy is truly your best option. You can also avail yourself of other options, such as consumer credit counseling. Your credit score will be forever effected by bankruptcy, which is why you should do everything else in your power to resolve matters first.
A key tip for those filing a personal bankruptcy petition is to always be completely honest in all documentation. As long as you are not hiding income or assets from the courts, you can ensure that there are no difficulties with your petition. This will save you from having your petition dismissed and your debts dropped from re-filing.
Don’t avoid telling your lawyer specific details with your case. Don’t assume that he’ll remember something from a month ago; tell him again. All information submitted to the court with your signature needs to be double checked.
If you can, get a word-of-mouth referral for a lawyer. 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.
Be sure to bring anything up repeatedly if you are unsure if your lawyer is focusing on it. Don’t assume that they will recall every detail that you go over with them without a friendly reminder. Don’t fear speaking up since it affects your case and future.
Before filling for bankruptcy, determine which assets will be exempted from seizure. To find an itemized list detailing assets exempt from bankruptcy, find the Bankruptcy Code. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. If you are not aware of the rules, you could be setting yourself up for a lot of stress when your most important possessions are taken in the bankruptcy.
Don’t hide assets or liabilities when filing for bankruptcy. It is necessary to be open regarding both the positive and negative aspects of your financial life. Do not leave anything out and come up with smart plan to manage the situation you are dealing with.
Safeguard your home. Filing for bankruptcy does not guarantee that you will lose your house. Depending on whether the value of your home has decreased or if you have a second mortgage on the home, you may end up keeping it. You could also check out the homestead exemption. This lets you continue living in your house, depending on whether you meet certain financial requirements.
Prior to filing for bankruptcy, discover which assets cannot be seized. To find an itemized list detailing assets exempt from bankruptcy, find the Bankruptcy Code. It’s crucial to read that list before filing to see which of your prized possessions can be seized. Without reading the list, you may be shocked at which possessions can be taken from you.
Learn and gain a firm grasp of the differences in applying for Chapter 7 bankruptcies versus Chapter 13 bankruptcies. Investigate the benefits and pitfalls of both. Online resources may be able to provide all the information you need. If you’re really not sure how this all works after your research, meet with your lawyer and ask them prior to making a decision.
Bankruptcy Process
Make time to visit with family and friends during the bankruptcy process. The bankruptcy process can be brutal. It is often overwhelming, and not quick. Some people may feel embarrassed or feel their self-esteem has taken a beating from it. There are a number of people who wish to go into seclusion while undergoing the process of personal bankruptcy. Self-imposed isolation can make you feel worse about it and can cause depression. Therefore, it is important that you continue to spend quality time with your loved ones despite, in spite of your current financial situation.
If you are meeting with a lawyer to discuss bankruptcy, the initial consultation should be free so ask every question you have. When you arrive at a consultation ask plenty of questions. You should also seek free consultations from several attorneys prior to choosing one. Only choose a lawyer if you feel like your questions were answered. It is not necessary to decide immediately after your consultation. Take your time, and schedule consultations with more than one lawyer.
If you make more money than what you owe, filing for bankruptcy is not a good option. Bankruptcy may seem to be the easy way out, but your credit report will show the scar for the next ten years.
Before filing for bankruptcy under Chapter 7, make sure that you consider the implications this will have on any of your co-debtor, who are usually family members, close friends or business associates. Debts which you shared with another will not be your responsibility any longer if you file for personal bankruptcy under Chapter 7. Creditors, however, will hold the co-signer liable for the entire balance of the debt.
Again, it is likely that whatever precipitated a bankruptcy filing was not something on which you look back fondly. Even though that is the case, you should not allow it to depress you in any way. Actually, by using the advice you’ve learned here, your story of hardship could have a happy ending after all!
Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. Take the time to find out about each one online, and look at the advantages and disadvantages of each. If you have trouble understanding the wealth of information, talk to your lawyer so he or she can help you make an informed choice.