Bankruptcy is very common in today’s economic climate. The economic downturn has played a large role. 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. The following article will provide you with this information.
If you are in a position where you are unable to pay your debts, bankruptcy may be the only option for you. When you get into this situation yourself, your first step is to familiarize yourself with your local bankruptcy regulations. Every state is different when it comes to dealing with bankruptcy. Your house is safe in certain states; however, in other states, it isn’t. Do not file before learning about the bankruptcy laws in your state.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. Generally, this type of debt is not covered by bankruptcy filing, and you will still have a large debt owing to the IRS. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
Instead of getting your lawyer from the yellow pages or on the Internet, try your hardest to find one with a personal recommendation. Companies are constantly popping up, claiming to help, yet only seek to profit from your misery. In ensuring that your bankruptcy is as simple as possible, trusting your attorney makes a big difference.
You are going to get found out and get in trouble if you don’t disclose all your assets, so be totally honest from the beginning. All of your financial information, be it positive or negative, must be disclosed to those in charge of filing your case. They need to know it all. Telling the truth will allow you reach a solution that is feasible, given your current situation.
Chapter 13 Bankruptcy
Chapter 13 bankruptcy might be a good option, so don’t overlook it. If you are receiving money on a regular basis and your unsecured debt is under $250,000, you may be able to file Chapter 13 bankruptcy. 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. Such plans generally take between 3 and 5 years to complete, at which point. a discharge will be granted. Stay mindful that should you for any reason miss even one plan payment, your whole case is going to get thrown out by the court system.
If you have filed for Chapter 13 bankruptcy, you will still be allowed to apply for and receive a mortgage or car loan. However, it won’t be as easy as it may have been to get one prior to the bankruptcy. Normally, the trustee assigned to your bankruptcy must approve any new loan. You need to develop a budget and show that you will be able to afford the new payment. Also, you need to be ready to say why you’re going to need the item.
When you file for bankruptcy, you should be very aware of your rights. There are unscrupulous debt collectors who may suggest that your obligations cannot be included in a bankruptcy. Few debts exist that are not covered by bankruptcy, such as student loans or child support. If your creditors are telling you any other kind of debts cannot be cancelled, get a written proof and send it to the general office of your state’s attorney to report this illegal behavior.
As you learned from the introduction of the article, bankruptcy is growing a lot these days, especially since the economy is slowly rebuilding. By using the information you’ve read here, you can now make sound decisions about your finances and choose the bankruptcy option that will work best for you.
This is a limited-time offer. We are not able to guarantee availability if you wait!
