Most people never expect to be in the position of facing bankruptcy. Sometimes things in life happen, but you have to be prepared for what comes your way. If that happens to you, you can use the information laid out in this article.
If you are faced with the choice of filing for bankruptcy or using your emergency fund or retirement accounts to pay creditors, opt to file for bankruptcy. Unless there is no other choice a retirement account should not be used. Though you may have to break into your savings, keep some available for difficult times. You will be glad you did.
Don’t hide assets or liabilities when filing for bankruptcy. Penalties may include fines, imprisonment or denial of the filing. Never hide anything, and make sure you come up with a well devised plan for dealing with bankruptcy.
It is important to understand your rights when filing bankruptcy. You can often have property returned to you. Autos, jewelry and even electronics that have been repossessed, could be returned. If the items were repossessed less than three months prior to your filing date, you may be able to recover them. Consult with a lawyer that can walk you through the filing process.
Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask a lot of questions. Most lawyers will meet with you for free and give you helpful advice, so meet with several. Don’t hire an attorney who fails to address all your concerns and questions. There is no need to offer an immediate hire, so take your time. Be sure to talk with a number of lawyers, and compare the information you receive.
If you are considering filing for bankruptcy you definitely need to hire an attorney. There are a lot of things to do during bankruptcy and that may be hard for you to understand on your own. A qualified bankruptcy attorney will guide you through the steps and help you do everything properly.
Prior to declaring bankruptcy you really need to be sure that you’ve exhausted all your other options first. For example, consumer credit counseling programs can help you by renegotiating your debts with your creditors into payments that you can afford. It is sometimes possible to negotiate smaller payment by yourself. If you do this, make sure you save a written record of debt modifications that are negotiated.
Chapter 7
There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice. All debt will be eliminated with Chapter 7. Any ties you have concerning creditors will definitely be dissolved. If you file using chapter 13 bankruptcy, you will go through a sixty month repayment plan prior to all your debts being completely dissolved. To make the wisest choice, you will need to understand the consequences of each of these two options.
If you are making more money than you owe, bankruptcy should not even be an option. Bankruptcy may seem to be the easy way out, but your credit report will show the scar for the next ten years.
Filing for bankruptcy should not be done on a whim. Ask a bankruptcy lawyer if a debt repayment plan or rate reduction would be of benefit. You can apply for a modification of your mortgage if your home is going into foreclosure. The lender may be willing to reduce interest rates, eliminate late charges or extend the life of the loan. Making arrangements with the creditors to make reasonable payments towards you debt is a much better plan than bankruptcy because the lender simply wants the loan repaid.
Never forget that you still deserve to enjoy life while you go through the bankruptcy process. It can be several months between the initial filing and the final discharge of debts. Stress easily leads to depression, if you are not maintaining control of your emotions. Life is going to get better once you get through this.
Bankruptcy should not be put off until the very last second. It is quite common for people to linger on hoping that their financial difficulties will somehow resolve; however, this very rarely happens. It doesn’t take long for debt to become unmanageable, and not taking care of it could eventually lead to wage garnishment or foreclosure. Once you realize that the debt you have is too much for you to handle, start thinking about talking to a bankruptcy attorney, they can guide you throughout the entire process.
Many people who have filed for bankruptcy, resolve to never use credit or credit cards again. However, building a good credit history requires that you occasionally use credit. If you never work on rebuilding your credit after a bankruptcy, you may not be able to qualify for a car loan or mortgage. One credit card is adequate to begin rebuilding your credit rating.
Choose a bankruptcy attorney carefully. Interview your prospective attorney regarding education and experience. Try to get a lawyer that has a lot of experience and one that is properly licensed. Be sure to look them up online, as you will be able to see their disciplinary record, background information, and ratings from previous clients.
Be sure to list any and all debts that need to be eliminated when you file your bankruptcy paperwork. Anything not listed will not be a part of the discharge. You should have everything in writing with dates and signatures to prove that your debts have been discharged, or you could be asked to pay these debts.
It’s not going to be fun and it’s not going to be easy, but you can simply the process if you’re reading the right information. This is much easier if you know more about the basics of bankruptcy. This article has given a lot of information, so you can feel less stressed about the situation.
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