The thought of bankruptcy has brought feelings of anxiety and fear into the lives of many people. From fears of growing debt to worrying that they’ll no longer be able to provide for their families, people have good reasons to be scared. If these circumstances sound familiar, you stand to benefit from the tips that follow.
Most people end up filing for personal bankruptcy because they owe more than they make. If this describes your situation, it makes sense to become familiar with relevant laws. Every state has a separate law having to do with bankruptcy. Your home and other major assets may be protected in your state, while they are vulnerable in other states. Familiarize yourself with the bankruptcy laws of your state prior to filing.
It’s not uncommon to learn soon after bankruptcy that you are unable to get an unsecured credit card easily. If this happens, instead you should turn your attention to secured credit cards. This will demonstrate that you’re seriously trying to restore your credit. Then, in time, it may be possible for you to obtain an unsecured credit card.
If a personal recommendation comes your way, this should be a lawyer you focus on. There are many companies who take advantage of financial desperation; that is why it is important that you get someone that is trustworthy.
Before you file for bankruptcy, find out which of your assets will be exempt from seizure. The Bankruptcy Code includes a list of the types of assets that are exempt from the bankruptcy process. You can determine exactly which of your possessions are at risk by consulting this list before you file. You may find yourself unpleasantly surprised when the things you value the most are taken from you without warning. This is why it is very important the familiarize yourself with this list.
Be persistent in researching information about filing for bankruptcy and consult a qualified personal bankruptcy attorney. Certain property cannot be repossessed while you are in the process of filing for bankruptcy so be sure to learn about the laws in your state. If your personal property was repossessed within 90 days before your bankruptcy filing, you may have a chance of getting it back. Get help from your lawyer to file a petition so you can get your items back.
Chapter 7
The two main kinds of bankruptcy are Chapter 7 and Chapter 13. Make sure you understand them so you know what is best for you. In Chapter 7 most of your outstanding accounts will essentially be erased. Your former ties with creditors will cease to exist. Bankruptcy under the rules of Chapter 13, on the other hand, require you to work out a payment arrangement to pay back the agreed upon amounts. You need to be aware of the pros and cons of each type of bankruptcy so you can correctly select the best choice for your situation.
Be around family as much as possible. The bankruptcy process can be brutal. It can take a long time, take a great emotional toll and cause people to feel embarrassed and defeated. It is not uncommon for a person to feel the need to pull away from loved ones during the process. However, self imposed isolation will only make you feel even worse about the process and could even lead to depression. For this reason, if you are undergoing personal bankruptcy proceedings, you must continue to live a normal life, spending time with your friends and relations.
Investigate other alternatives before resorting to bankruptcy. Find out if you can receive a reduced interest rate or altered repayment plan instead of bankruptcy filing. Look into loan modification plans if you need to deal with an imminent foreclosure. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Once the initial filing period is over, ensure that you are getting out and enjoying life. Bankruptcy is a stressful process: you will have to go over your bad financial decisions and perhaps feel ashamed about your decision. This kind of stress can take a heavy toll on your personal life, especially if you are not making any efforts to adopt a positive attitude. Once the process is complete your life will improve.
You may want to see if you can get lower payments on your vehicle if you want to keep it. Chapter 7 bankruptcy is one of the most common and effective. If you meet the criteria specific to your state, it may be a good option to consider.
Many people are frightened by bankruptcy, and for good reason. Filing for bankruptcy can be a very stressful and fearful experience, especially if you don’t know what you’re doing. That said, the best antidote to fear is information, and this article has given you that in spades. Use this personal bankruptcy advice as soon as possible and make things better for yourself and your loved ones.
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