It is unfortunate that many people are currently facing bankruptcy. This is due to the current financial climate. However, before you make the decision to file for personal bankruptcy, you should understand the filing process and thoroughly investigate whether it is the right choice for you. If you read this article, you will learn what you need to know.
Determine which of assets are safe from seizure and which are not before filing for personal bankruptcy. Check the bankruptcy laws in your state to find out if certain items are excluded from your bankruptcy filing. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. You may find yourself unpleasantly surprised when the things you value the most are taken from you without warning. This is why it is very important the familiarize yourself with this list.
You must be entirely candid when it comes to declaring assets and obligations in your bankruptcy petition. Your bankruptcy lawyer has to know every detail of your finances, whether bad or good. Put everything out on the table and craft a wise plan for handling the situation the best you can.
See if there is an alternative you can use before declaring bankruptcy. For example, consumer credit counseling programs can help if your debt isn’t too large. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
Chapter 7
You may have heard bankruptcy referred to differently, either as Chapter 7 or Chapter 13. Learn the differences between the two before filing. Under Chapter 7 type bankruptcy, all debts are forgiven. Any ties that you have with creditors will be dissolved. 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. Take the time to learn more about these different options so you can make the best decision possible.
A free consultation is standard for bankruptcy attorneys, so shop around before settling on one. Just be sure that the person you speak with really is the lawyer, rather than a paralegal, since they cannot legally give advice. It will be important to work with a bankruptcy lawyer that you feel comfortable with; a little comparison shopping will help you find the right one.
Unsecured Debt
Consider Chapter 13 bankruptcy. In most states, Chapter 13 bankruptcy law stipulates that you must have under $250,000 of unsecured debt and a steady income. That kind of bankruptcy allows you to hold on to your personal things and real estate while repaying your debts with a plan to consolidate your debt. This plan usually lasts from 3 to 5 years, after which, you will be discharged from all unsecured debt. Keep in mind that missed payments will trigger dismissal of your case.
Make time to visit with family and friends during the bankruptcy process. Undergoing bankruptcy can be a difficult experience. It takes a long time, it can be stressful, and people feel unworthy, guilty and ashamed. A lot of people become depressed and withdrawn until their bankruptcy is discharged. This is not recommended because you will only feel bad and this may cause you to feel depressed. So, it is critical that you spend what quality hours you can with loved ones, regardless of your financial circumstances.
Take some time after filing for bankruptcy to enjoy life. Many people who undergo this process become way too stressed out. This stress could morph into clinical depression, if you fail to adequately address the problem. Once the process if over, your life will improve.
Make sure the time is right when you file a bankruptcy claim. When it comes to filing for bankruptcy, your timing is important. There are occasions where it pays to delay and others where a quick decision is the best option. Speak with a bankruptcy lawyer about when the best time is to file for your specific needs.
In conclusion, bankruptcy is common these days, many times because of the way the economy is. Use the tips you just read to make good decisions and remain in control of your financial situation.
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