If the IRS or your other creditors are on to you about the money you owe, you should consider filing for bankruptcy. Bankruptcy will hurt your credit, this is true. However, it may be the only viable option available to you. Keep reading to gain a better understanding of the bankruptcy process and of the ramifications of initiating a filing.
Lots of people have to claim bankruptcy when their bills are larger than their income. Study the laws in you state to learn what you need to do and what your options are. Each state has their own bankruptcy laws. For example, the personal home is exempt from being touched in some states, but not in others. See to it that you understand the bankruptcy laws in the area that you live prior to filing.
Be sure everything is clear to you about personal bankruptcy via looking at websites on the subject. The United States Some valuable resources include the U.S. Dept of Justice and American Bankruptcy Institute. The more you know about it, the better you are able to make the best decision for your situation and to make sure that the bankruptcy proceedings move forward with minimal setbacks.
Instead of getting your lawyer from the yellow pages or on the Internet, try your hardest to find one with a personal recommendation. Don’t allow yourself to be taken advantage of by predatory lawyers just because you are filing for bankruptcy. It is important to find someone trustworthy.
Find a specialized lawyer if you are thinking about filing for bankruptcy. Filing for bankruptcy is a complicated procedure, and you may not be aware of all the ins and outs. A qualified bankruptcy attorney will guide you through the steps and help you do everything properly.
Meet with a few attorneys who offer free consultations before hiring one. Meet with the actual lawyer, not a paralegal or assistant, as they’re not allowed to give out legal advice. Looking for an attorney will help you find a lawyer you feel good around.
Make sure that you really need to file for bankruptcy. You may be able to get away with going through debt consolidation to help make the payments easier to deal with. Going through the bankruptcy process is a long drawn process which at times can be incredibly stressful. It will certainly affect the credit rating that you have in the future. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.
Before declaring bankruptcy, see if there’s anything less drastic you can do to repair your credit. You can get your interest rates reduced or enter into a debt repayment plan. Before you file bankruptcy, ask your attorney if any of these are viable alternatives for you. If you are facing foreclosure, consider a loan modification plan. Your particular loan holders can provide a lot of assistance if you’re just willing to speak with them. You can negotiate lower rates, longer terms, and other means of repayment that may keep you from having to file a claim. Most creditors will be willing to work out an option to avoid not getting paid at all.
If you decide to file for bankruptcy, it’s important that you’re educated about your rights. Some bill collectors will tell you that your debts can’t be bankrupted. Only a few debts are immune to bankruptcy. Taxes, student loans and child support would be the major ones. If the debt collector tries to tell you that your debts, which do not fall into those categories, cannot be bankrupted, take a note of it, look up the debt type, and report them to your state’s attorney general office.
In conclusion, the option of bankruptcy is always there. The consequences for your credit make it a last resort in most cases. Reading up on the right ways to handle your situation will save you a lot of headaches in the long run.
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