Coping with the realization that you have to file bankruptcy is not any easy thing to do. When you’re constrained financially, your options become limited, in general. Although, this situation should not get you down because there are items you can still get like a home loan or car, continue on and learn how.
It is important that you increase your knowledge on personal bankruptcy by reviewing websites that provide reliable information. The U.S. Some valuable resources include the U.S. Dept of Justice and American Bankruptcy Institute. The more information you have, the more confident you can be about any decision you make and you will know that you are doing the best thing possible for your situation.
When choosing a bankruptcy lawyer, your best option is to find someone who is recommended by someone you know versus someone who you find online or in the phone book. There are so many dime-a-dozen companies out there who make it a practice of preying on financial desperation. You need to make sure your bankruptcy goes smoothly, so find someone you know you can trust.
Chapter 13
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. All debt will be eliminated with Chapter 7. All the things that tie you to creditors will go away. Chapter 13 is different, though. This type of bankruptcy entails an agreement to pay off your debts for five years prior to wiping the slate clean. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
Your most important concern is to protect your home. It isn’t inevitable that you will lose your house when you file for bankruptcy. Depending on certain conditions, you may very well end up being able to keep your home. If this is not the case, find out more about Homestead Exemptions you might qualify for if you meet certain financial requirements.
Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. Take the time to find out about each one online, and look at the advantages and disadvantages of each. Ask your bankruptcy lawyer to clarify anything you don’t understand before making a final decision about which type of bankruptcy to file.
Do not forget to be around those you love. Bankruptcy proceedings can be extremely harsh. Not only is the process long, but it can be stressful, and many people feel ashamed when they do it. There are a number of people who wish to go into seclusion while undergoing the process of personal bankruptcy. However, this isolation will just make you feel worse, and it could cause you to be depressed. Therefore, it is important that you continue to spend quality time with your loved ones despite, in spite of your current financial situation.
A great tip to remember if you have filed for Chapter 13 is that you will still be able to receive a loan, so you shouldn’t refrain from trying. However, it won’t be as easy as it may have been to get one prior to the bankruptcy. You will be required to meet a trustee and be approved for a 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. Also, be sure you can provide an explanation as to why this purchase is necessary.
Prior to filing for bankruptcy, tell yourself that you cannot use the word “shame”. Feelings of low self-worth, shame and guilt are common for those who have come to the point where bankruptcy is their only option. Wallowing in these emotions benefits no one, and only serve to harm your own mental health. Keep your mindset positive while you work through financial troubles such as bankruptcy to reduce stress and have an easier time coping.
See to it that you are aware of the laws concerning bankruptcy before you consider filing. For instance, you need to know not to shift assets into someone else’s name in the year leading up to your filing. Not only that, but the filer cannot lawfully accrue additional debt just prior to filing.
Before you file for bankruptcy, be sure you know how to properly repay your debts. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and friends and family for up to one year. Read the rules before making financial decisions.
Before you decide to file bankruptcy, you should think of ways to become more financially responsible. The period before your filing is not the time to run up additional debts. Creditors and judges will consider both past and current history when deciding on your personal bankruptcy. Your current spending behavior should show that you are making a real effort to modify your financial habits.
Personal Items
You do not need to lose all your assets just because you file for bankruptcy. Your personal items will stay with you. These personal items include clothing, jewelry, household furnishings, electronics and other similar items. You will need to talk to a bankruptcy attorney to find out whether your local laws and personal situation will allow you to keep your car or home.
List out who you owe money to. Be sure your list is complete as it will form the basis of your personal bankruptcy filing. Obviously, you’re going to want to leave no stone unturned. Rummage through your files and records and receipts to come up with precise numbers. This process should not be rushed; the numbers should be exact.
Even if you have filed for bankruptcy you now realize that this does not limit you in life forever. If you are willing to work hard to save money and do not spend frivolously, you can regain your credibility with creditors. Build up your savings and see what kind of deal you can get when you apply for a car loan or a mortgage.
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