There are quite a number of people who have been affected by the economy, and now find themselves buried in debt. Threats come from collection agencies and other creditors while the bills just keep piling up. If this sounds like your situation then perhaps filing for bankruptcy may be in the cards for you. The bankruptcy laws vary in each state, so educate yourself on the laws in your state.
Be sure everything is clear to you about personal bankruptcy via looking at websites on the subject. The United States Department of Justice, NACBA, and American Bankruptcy Institute websites are all great places to go for up-to-date information. Knowing is half the battle, after all, and these websites are the first step in learning what you need to know to make your bankruptcy smooth and stress-free.
Credit Card
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. In a lot of places, the debt cannot be discharged, and you may still owe money to the IRS. Transferring the debt to another medium (e.g. a credit card) won’t magically make a tax debt discharagable, either. So, there is no reason to use your credit card if it will be discharged in the bankruptcy.
Always be honest with the information you give about your finances. Not only is hiding income and assets wrong, it is also a crime.
Obtain Unsecured
It can be difficult to obtain unsecured credit once you have filed for bankruptcy. Since it is important that you work to rebuild your credit, you should instead think about applying for a secured card. That will show lenders that you are committed to rebuilding your credit. In time, it may be possible for you to obtain unsecured cards.
When a bankruptcy is imminent, retain a lawyer immediately. You may not know everything you need to know in order to have a successful outcome of your case. A personal bankruptcy attorney can help and guide you along through the bankruptcy process.
It is possible to keep your home. There are many options available to help protect you from losing your home. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. Otherwise, try looking into house exemptions that may let you remain in the home if you meet certain financial threshold requirements.
Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. Spend time researching the advantages and disadvantages of filing for each one of these. If something doesn’t make sense to you, go over it with your lawyer prior to choosing which one to file.
Look at all of your options prior to deciding to file for bankruptcy. Speak with an attorney who specializes in bankruptcy to find out if alternatives, such as a debt repayment plan or a reduction of your interest rates, might be better for you. If a foreclosure is on your horizon, look into loan modification plans. Sometimes your lender will work with you to help pay off your debt by giving you a lower interest rate, forgiving late fees, or extending the time period of your loan. Most creditors will be willing to work out an option to avoid not getting paid at all.
Take some time after filing for bankruptcy to enjoy life. It’s easy to be stressed during this time. Depression can ensue from the stress if action isn’t taken. Once your petition is in the hands of the judge, all you can do is wait.
Chapter 7
Before you choose Chapter 7 bankruptcy, think about what effect that is going to have on any co-signers you have, which are usually close relatives and friends. Debts which you shared with another will not be your responsibility any longer if you file for personal bankruptcy under Chapter 7. Your creditors can then come after your co-debtor for full repayment of the debt.
An understanding of your rights is important before filing for bankruptcy. You might hear from your creditors that your debts cannot be canceled through bankruptcy. Only a small number of debts are not dischargeable, including student loans and child support obligations. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
If you are thinking about filing for bankruptcy, one of the first things you should do is look into the laws of your state. For instance, it’s prohibited for an individual to transfer assets to someone else a year before filing for bankruptcy. In addition, it is unlawful for the filer to increase the amount of debt they are carrying on their credit cards right before they file.
Know the rules of personal bankruptcy prior to petitioning. There are many traps in the bankruptcy laws that could trip up your case. It is even possible to make the sorts of errors that can cause your case to be dismissed. Before you begin bankruptcy proceedings, research as much as you can. Doing so will make the process a lot easier.
As you can see, there is a lot of help available if you are considering filing for personal bankruptcy. When you handle it correctly, a bankruptcy can resolve a great number of your financial troubles and enable you to start turning your life around.
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