If you have been threatened by repossession of your possessions, it is time to think about filing for bankruptcy. When your debt situation gets serious enough, you may want to consider personal bankruptcy as a way to save yourself. In the following paragraphs, you’ll find advice that will guide you through the bankruptcy process.
Do not pay your taxes with credit cards that will be canceled when you file for bankruptcy. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. Therefore, you have no reason for use of a credit card, if the amount is to be discharged in due process of the bankruptcy.
Credit History
Exhaust every other option before making the decision to file for personal bankruptcy. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Bankruptcy is a serious negative on your credit history so make sure you have no other options before you file. It is important to keep your credit history as positive as possible.
Do not attempt to conceal any assets when filing for bankruptcy because you may be penalized when they are discovered. Your attorney and trustee should be privy to all information about your finances. Do not leave anything out and come up with smart plan to manage the situation you are dealing with.
You should never give up. When you file for bankruptcy you may be allowed to recover property like your car, electronics or jewelry that might have been repossessed. Any property repossessed within 90 days before filing bankruptcy, may be able to be returned to you. Interview and research attorneys before choosing one to help you with your bankruptcy.
Find a specialized lawyer if you are thinking about filing for bankruptcy. Filing for bankruptcy is a complicated procedure, and you may not be aware of all the ins and outs. An attorney specializing in personal bankruptcies can assist and make certain things are being handled correctly.
Investigate any new laws before deciding to file a bankruptcy. Bankruptcy laws change a lot and before making the decision to file, you need to know what you are getting yourself into. A qualified bankruptcy attorney is the best source for the latest information regarding the laws in your state.
Chapter 13 Bankruptcy
Thing about filing a 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. Filing a Chapter 13 will let you keep personal items and real estate while you pay down your debt in a consolidation plan. It usually takes three to five years to fulfill this plan. When the time is up, you’re unsecured debts will be discharged. Remember that you must make every payment. Missing even one could cause the court to dismiss your case.
If your paycheck is larger than your debts, avoid filing for bankruptcy. Sure, bankruptcy can get rid of that debt, but it comes at the price of poor credit for 7-10 years.
If you are in the midst of a Chapter 13 bankruptcy, it is possible to apply for certain loans. It is a little more difficult, though. Normally, the trustee assigned to your bankruptcy must approve any new loan. When meeting with the trustee, bring a budget which shows that you will be able to afford the payment on the loan you are trying to get. You should also be prepared to explain why you need to purchase the item.
Bankruptcy is a challenging time and can create a huge amount of mental and emotional stress. Working with a good bankruptcy lawyer can help make the process a lot smoother and less stressful for you. Try not to pick a lawyer based on cost alone. It is not necessary to engage the lawyer who charges the highest fees; all you need is a lawyer of high quality. Ask people who have used a bankruptcy lawyer for referrals, look them up at your local Better Business Bureau, then schedule free consultations in order to interview them. When looking at bankruptcy attorneys, consider sitting in on one of their court hearings to find out how they handle the case.
Of course you could decide to file bankruptcy, but learn of your other choices first. Avoid debt consolidation services and credit counseling services that seem too good to be true. Keep the advice from this article in mind in order to make ideal financial decisions and stay away from debt.
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