Most people consider bankruptcy as a choice of losers, but quickly change their mind when it directly affects them. Often filing for personal bankruptcy happens as the direct result of changing conditions (e.g. the dissolution of a marriage or the loss of a job). If you find yourself in this position, the following article will be of great assistance.
Personal Bankruptcy
Be certain to gain a thorough understanding of personal bankruptcy by using online resources. The United States Department of Justice and American Bankruptcy Institute are two such places to look. The more knowledgeable you are, the more you can be sure that you are making the right decision and that you are taking the right steps to ensure your personal bankruptcy goes as smoothly as possible.
After a bankruptcy, you may not be able to receive any credit cards. If this happens to you, think about applying for a couple of secured credit cards. This will allow you to start building a good credit history while minimizing the bank’s risk. Once you’ve built up a history of on-time payments, you may start getting unsecured credit again.
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.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. The Bankruptcy Code has lists of various asset types that are exempt during the process. It’s crucial to read that list before filing to see which of your prized possessions can be seized. If you fail to do so, things could get ugly.
Learn of new laws prior to deciding to file for bankruptcy. This area of law is in constant flux and it is imperative that you know where the law stands at the time you file for your bankruptcy. To stay up-to-date on these laws, check out your state’s government website.
Before declaring bankruptcy, ensure that all other options have been considered. If you owe small amounts of money, you can join a counseling program or straighten your finances out by yourself. Also, you could try to get your payments lowered on your own. If you decide to do this, get a copy of anything you agree to.
Chapter 13
Learn the differences between Chapter 7 and Chapter 13 bankruptcies. Chapter 7, for example, will wipe away every one of your outstanding debts. You will be removed from any contracts you have with your creditors. Chapter 13 is different, though. This type of bankruptcy entails an agreement to pay off your debts for five years prior to wiping the slate clean. You have to know what differs between all of the kind of bankruptcy, so you know which is one is ideal for you.
Don’t file for bankruptcy unless it’s absolutely necessary. Consolidating current debt could make it easier to manage. It is not a quick and easy process to file for bankruptcy. Your future credit will be affected by these actions. You only want to file for bankruptcy after you have exhausted your other options for dealing with your debts.
Consider filing using chapter 13 bankruptcy. If you posses a regular source when it comes to income, and you have less than $250,000 of unsecured debt, you could file using Chapter 13 bankruptcy. You can secure your home under Chapter 13 and pay your debts with a payment plan. That plan lasts approximately three to five years, and then you are discharged from unsecured debt. Keep in mind that missed payments will trigger dismissal of your case.
Bankruptcy is a valid option to consider once you begin to run out of ways to keep your debts under control. If circumstances beyond your control have brought you to this place, you do not have to be stressed out. This article will give you the information that you need to know.
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