The economy is bad looking these days. A poor economy means more people than ever have debt and are losing their jobs. Debts result in bankruptcy, which is never a good thing. If you or a loved one is considering bankruptcy, find out what to do about this situation by reading this article.
Instead of jumping into a bankruptcy filing, be sure your situation requires it. Other available options include consumer credit counseling. Your credit score will be forever effected by bankruptcy, which is why you should do everything else in your power to resolve matters first.
If you suspect that bankruptcy filing may be a reality, don’t try to discharge all your debt in advance by emptying your retirement or saving accounts. You should always keep money saved for worse times. While dipping into your savings is likely to be necessary, avoid wiping it out completely to prevent leaving yourself with little financial security in the future.
Don’t be reluctant to remind your lawyer about specific details he may not remember. Many times a lawyer may forget a key detail; therefore, it is important to remind your lawyer of any key information. Ultimately, this is your bankruptcy and your financial future, so never hesitate to advocate on your behalf.
Consider Chapter 13 bankruptcy for your filing. If you currently have some income and don’t have more than $250k in debt, you can declare bankruptcy. This lets you keep any real estate and personal property while you repay all your debts through a consolidation program. Such plans generally take between 3 and 5 years to complete, at which point. a discharge will be granted. Remember, though, that if you fail to make even one payment, the case will be thrown out and you’ll be right back where you started.
Don’t file bankruptcy if you can afford to pay your debts. Bankruptcy might seem like a good way to get out of paying your bills, but it will devastate your credit for the next ten years.
Chapter 7
If you are moving forward with a Chapter 7 bankruptcy, you need to learn how that can negatively affect anyone who shares loans with you. Once you have filed Chapter 7, you, by law, are not responsible for any of your debts that also include your co-debtor. But, bear in mind, the debt now becomes the sole responsibility of your co-debtor.
It is possible to obtain new vehicle and home loans while a Chapter 13 case remains active. There will, however, be obstacles. You will have to get this loan approved by your trustee. Draw a budget up and show how you can pay the newer loan payment. An explanation of need will also be necessary.
It is in your best interest to be abreast of your rights in petitions for bankruptcy. It is not unusual for creditors to claim that their debt is not able to be discharged. However, there are few debts that cannot be eliminated, like student loans and child support payments. If a collector uses this tactic about debt that can, in fact, be discharged through bankruptcy, report the collection agency to the attorney general’s office in your state.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. As an example, it is prohibited for someone to transfer assets from the filer’s name for one year prior to filing. In addition, it’s unlawful for a filer to acquire more debt on their credit cards before they file.
Try your hardest to present a complete representation of your current financial situation. If you forget to add these, your petition could be delayed or dismissed. It is better to have something on there that you are unsure about, rather than not include it at all and risk a dismissal. This type of income could come from doing odd jobs, extra cars or outstanding loans.
It is important not to delay the process of determining whether or not you should file for bankruptcy. Filing for bankruptcy is a hard decision to make but if you wait too long, your situation will get worse. Speaking with a professional in a timely manner will allow you to receive sound advice that can help you before things get out of hand.
Make a list of all your debts. This will be the basis for your bankruptcy filing, so make sure you include all the debts you are aware of. Review your records to determine the precise amounts that you owe. Take care not to miss any debts that you need to disclose, or you will be responsible for paying them back after you have filed for bankruptcy.
While the economy is beginning to gather steam, a number of people still do not have jobs or acceptable compensation. If you don’t have steady income, you might still be able to avoid bankruptcy. Bankruptcy can be a difficult journey; however, the process can be made easier by learning the aforementioned information. Best of luck.
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