Most people do not think they will ever need to consider filing for bankruptcy. When life throws you lemons, sometimes you have no choice but to try and make lemonade out of them. If this situation applies to you, the following article will be of great assistance.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. A common rule is that dischargeable tax means dischargeable debt. So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
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 Justice Department, the ABI (American Bankruptcy Institute), as well as the NABCA (National Assoc. Consumer Bankruptcy Attorneys) are excellent sources of information. You will find that the process of filing for personal bankruptcy is easier and less of a hassle with the more information on the subject you gather ahead of time.
Credit History
Be sure you’re doing what’s right before you file for bankruptcy. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Bankruptcy can leave your credit history permanently marked. Prior to doing this you need to be sure you try everything else first to get your credit history into shape and to lessen the impact.
It’s not uncommon to learn soon after bankruptcy that you are unable to get an unsecured credit card easily. In this event, you should attempt to apply for a secured card or two. That will show lenders that you are committed to rebuilding your credit. After using a secured card for a certain amount of time, you might be offered an unsecured card once again.
Prior to putting in the bankruptcy paperwork, determine what assets are protected from seizure. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. Make sure to review the list before filing a claim so you know if your valuables will be subject to seizure. If you fail to do so, things could get ugly.
Prior to filing for bankruptcy, discover which assets cannot be seized. Check the bankruptcy laws in your state to find out if certain items are excluded from your bankruptcy filing. Make sure that you carefully look over this list prior to filing to discover if your valuable assets will be seized. If you don’t read this list, there is a chance that you might get nasty surprises when they take your things away.
Before declaring bankruptcy, ensure that all other options have been considered. For example, if you only have a little bit of debt, you might be better off if you went through consumer credit counseling. You should also try negotiating a payment plan with your creditors; make sure you get a written agreement of the new payment plans.
Become knowledgeable in regards to details about chapter seven bankruptcy vs. chapter 13 bankruptcy. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. 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.
Most bankruptcy lawyers give free consultation, so try to meet with these types of lawyers before deciding on hiring one. Make sure you meet with a licensed attorney rather than a paralegal or assistant, because it is illegal for these people to give legal advice. By shopping lawyers, you will be more likely to find one that makes you comfortable about the process.
Chapter 13 Bankruptcy
Consider if Chapter 13 bankruptcy is an option. If you are receiving money on a regular basis and your unsecured debt is under $250,000, you may be able to file Chapter 13 bankruptcy. You can secure your home under Chapter 13 and pay your debts with a payment plan. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
When you are forced to file for bankruptcy, you should have some excellent knowledge on what to do. The process is anything but simple, and information will become your best friend during this difficult time. The article that you just read offered valuable information which you can use to help alleviate some of the stress when dealing with your financial situation.
If you are considering filing for personal bankruptcy, be certain that this is really the right course of action for you. It may be that all you really need to do is consolidate some of your debts. Filling for bankruptcy is a lengthy, stressful process. Having a bankruptcy on your record will hinder your ability to get credit in the future. Personal bankruptcy should be undertaken as a last resort when no other workable options are available to you.