No one expects to have to go through bankruptcy. However, circumstances can change in an instant, leaving a situation where bankruptcy may be the best choice. It is crucial that you know what to do should it happen to you. If you see yourself headed towards bankruptcy, the tips contained in the article below will be of great help to you.
When you document your financial records, it is vital that you are 100% truthful in order to have a successful resolution to your bankruptcy process. 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.
Stay abreast of new laws that may affect your bankruptcy if you decide to file. These laws change regularly and you should stay up-to-date so you can make the best decisions. To learn about these changes, try contacting your state’s legislation office or checking their website.
Chapter 7
You need to educate yourself on the differences between Chapter 7 and Chapter 13. Chapter 7 bankruptcy completely wipes out your debt. You will be removed from any contracts you have with your creditors. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Most bankruptcy lawyers give free consultation, so try to meet with these types of lawyers before deciding on hiring one. Ask to speak with the licensed attorney and not a representative, who can not offer legitimate legal counsel. Hiring a lawyer could help you become comfortable with the legal things that you will encounter.
Chapter 13 Bankruptcy
Consider Chapter 13 bankruptcy for your filing. In most states, Chapter 13 bankruptcy law stipulates that you must have under $250,000 of unsecured debt and a steady income. This lets you keep any real estate and personal property while you repay all your debts through a consolidation program. The plan is usually for a term of three to five years, and a discharge will be granted at the end of that term. Just ensure that you take necessary precautions, as missing one payment can result in the court dismissing your case.
Remember to spend some quality time with your loved ones. Bankruptcy proceedings can be extremely harsh. It takes a long time, it can be stressful, and people feel unworthy, guilty and ashamed. Many people tend to hide until their process is completed. This is not a good idea because staying alone could cause serious problems with depression. So, it is critical that you spend what quality hours you can with loved ones, regardless of your financial circumstances.
Before you file for personal bankruptcy, weigh all of your options. Talk with a bankruptcy lawyer and ask about alternatives, such as debt consolidation or negotiating with creditors. Loan modification plans on home loans are a great example of this. There are many ways in which a lender can make adjustments that will be helpful to you. Among them are extending the loan, forgiving late charges and reducing the interest rate. Most creditors will be willing to work out an option to avoid not getting paid at all.
If you are considering bankruptcy, do not leave it until the last possible moment to do so. Some people just ignore the trouble they are in financially and think it will go away later. This is not a good decision. Your debt can quickly get way too large, and as a result, you may discover that you must foreclose your home or garnish some of your wages. When you find that you cannot take care of your debts anymore speak with an attorney for bankruptcy to talk things over.
If you are facing bankruptcy, it is important to get expert advice to address your situation and take the necessary actions to resolve it. The process will be much simpler if you are well-informed. Now that you have read the advice shared here with you, you can move forward on the right financial path for you.
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