It can be a difficult process to file for bankruptcy. There are a number of kinds of bankruptcy. The type that applies to you will be chosen based upon the type of debts you have. Therefore, it is essential that you learn about bankruptcy prior to petitioning the courts for bankruptcy protection. The following tips will help put you on the right path.
Make certain that you comprehend everything regarding personal bankruptcy by studying online. Many sites, including the U.S. Department of Justice, the American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys, all provide valuable information. The more you know, the better equipped you’ll be to make the wise decisions needed for a successful bankruptcy.
If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. You should not use your retirement savings unless the situation calls for it. Your savings accounts offer valuable financial security so try to leave them intact.
Prior to filing for bankruptcy, discover which assets cannot be seized. The Bankruptcy Code provides a list of all the different kinds of assets that you can exclude. You can determine exactly which of your possessions are at risk by consulting this list before you file. Without reading the list, you may be shocked at which possessions can be taken from you.
Keep with what you have decided to do. Filing for personal bankruptcy may possibly enable you to reclaim your personal property that have been repossessed, like your car, electronics and jewelry items. If it has been fewer than 90 days since you filed for bankruptcy, it is possible for you to get repossessed property back. Consult with a lawyer who can advise you on what you need to do to file a petition.
Chapter 13
Consider Chapter 13 bankruptcy for your filing. With a consistent income source and less than $250k in debt, try filing for Chapter 13. Not only can you repay your debts through consolidation, personal property can be kept, as well as real estate. That plan lasts approximately three to five years, and then you are discharged from unsecured debt. Missing a payment under these plans can result in total dismissal by the courts.
Bankruptcy can be a good time to spend time with people you love. Going through a bankruptcy can be an excruciating experience. It is long, hard and sometimes leaves people feeling guilty or ashamed. It can be hard to face the world while the bankruptcy process is taking place. Pulling away from people who care for you will not help the situation, and can cause your negative feelings to intensify. Time spent with people who care about you can give you new perspective on your financial situation.
Chapter 7
Remember that filing for Chapter 7 personal bankruptcy will not just affect you. Think about the effect it will have on business associates, friends and family or anyone else who may be a co-signer with you. When filing for Chapter 7, you won’t be responsible legally for debt signed by co-debtors and yourself. Any co-debtor may well be held responsible for paying off the total remaining amount of the debt, though.
Car loans or mortgage loans are still a possibility when you have filed for Chapter 13. However, it can be more difficult. You will be required to meet a trustee and be approved for a new loan. You will need to make a budget and prove that you will be able to afford your new loan payments. You’ll also need a valid reason for making the purchase.
Before declaring bankruptcy, it is important to know your rights. There are bill collectors who will claim that you cannot add your debts to your bankruptcy case. Only a few kinds of debt, like student loans or child support, are ineligible for bankruptcy. If you are unsure about specific types of debt, check the bankruptcy laws in your state or consult an attorney.
Go over the debts you are currently paying off before filing for bankruptcy. You may find that bankruptcy law prohibits you from paying back some types of creditors for 90 days before you file, and a year for family members. Do not make a decision about filing until you are aware of all the current rules regarding bankruptcy.
Credit Cards
Most people that file for bankruptcy try not to use credit cards again. In reality, though, credit cards can be a useful tool for people who are looking to rebuild their credit score after bankruptcy. You will not be able to get your credit back to a respectable score if you don’t use credit. One credit card is adequate to begin rebuilding your credit rating.
Now you know that filing for bankruptcy is something to be considered before going through with it. Should you determine that it is a wise move considering your personal circumstances, you need to consult with a lawyer who has handled many other bankruptcy cases.
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