Just thinking about bankruptcy is a scary thought for many people. Growing debt, along with insufficient income to support a family, can make life seem unbearable. If this troubles you, or if you are dealing with this nightmare now, the following information is required reading.
When people owe more than what can pay, they have the option of filing for bankruptcy. If you’re in this situation, learn about the laws where you live. Every state has a separate law having to do with bankruptcy. Your home is safe in some states, but in others it’s not. You should be familiar with the laws for your state before filing for bankruptcy.
Never shirk on the truth in your petition for bankruptcy. It is vital that you disclose all information about your assets and income so there are no delays or penalties, such as a court barring you from filing again later in the future.
Although you can find many bankruptcy attorneys listed in your local Yellow Pages or online, it’s best if you can find one through the personal recommendation of a friend, family member or acquaintance. Some companies just want to take advantage of you, so it is important that you have help from someone you trust.
If you’re filing for bankruptcy soon, be sure you are going to hire a lawyer. It is difficult to make all of the necessary decisions yourself, and expert guidance will be helpful. A lawyer that specializes in bankruptcy can make sure you are following the correct procedures in your filing.
Chapter 7
Remember to understand the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. The Chapter 7 variety can help you eliminate your debts almost entirely. The ties with the creditor will be broken. If you choose to file for Chapter 12 bankruptcy, you’ll be put into a 60-month plan for repaying your debts before they’re eliminated. Take the time to learn more about these different options so you can make the best decision possible.
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’re really not sure how this all works after your research, meet with your lawyer and ask them prior to making a decision.
Chapter 13
Consider if Chapter 13 bankruptcy is an option. You are eligible for filing bankruptcy under Chapter 13 if you work and owe less than $250,000. The benefit of this plan is that you retain personal belongings and private real estate and your debts are repaid by an organized payment plan. Expect to make payments for up to 5 years before your unsecured debts are discharged. Remember that missing a payment to the plan will result in your case being dismissed.
Remember to have fun with your life when you’re done with the filing process initially. The process of filing for bankruptcy can make people a nervous wreck. This stress could morph into clinical depression, if you fail to adequately address the problem. You are getting a fresh start, and things will get better.
Take a look at all of your financial options before filing for personal bankruptcy. Perhaps credit counseling can resolve your issues. You can get the help you need from a variety of non-profit credit counseling companies. They can work with those you owe money to in order to give you lower payments and lowered interest rates, too. You’ll make your payments to the company, and the company will pay off your creditors.
It is important not to delay the process of determining whether or not you should file for bankruptcy. Yes, it is hard to admit that you need help; however, the longer you wait the deeper in debt you get. The time to seek out professional advice on bankruptcy is as early as possible. Your financial situation will get complex very quickly, so wise counsel is more valuable the earlier you get it.
After filing bankruptcy, many people refuse to use credit cards or get loans. This isn’t necessarily a good strategy to follow since establishing good credit goes hand-in-hand with getting, and handling, credit in a responsible manner. You will not be able to get your credit back to a respectable score if you don’t use credit. You can rebuild your credit slowly, beginning with just one credit card.
Don’t wait until after filing for bankruptcy to become more responsible with your finances. You must not doing anything that will raise your current level of indebtedness for several months before filing a bankruptcy petition. Determinations on whether to grant a bankruptcy are made after looking at your entire record; current history in addition to past issues. Show that you are making a positive change to your current financial situation.
Many people are frightened of bankruptcy, and rightly so. That said, the best antidote to fear is information, and this article has given you that in spades. Use the bankruptcy information in this article to make your financial life yours again.
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