The circumstances that culminate in a bankruptcy filing are likely unpleasant, though they do not need to define the rest of your life. Bankruptcy is all about giving you a fresh start. Keep reading for how you can make bankruptcy a second chance instead of financial doom.
Be sure everything is clear to you about personal bankruptcy via looking at websites on the subject. The United States DOJ, the NACBA, and the ABI all have useful information. You need to spend some time gathering valuable information so you can file your bankruptcy with confidence.
Credit Card
If you are thinking about paying off your tax obligations with a credit card and then filing bankruptcy, think again. The fact is that the credit card debt will be ineligible for discharge, and your tax debt may increase. Should the tax be dischargeable, the debt is often dischargeable as well. This means using a credit card is not necessary, when it will just be discharged.
Instead of jumping into a bankruptcy filing, be sure your situation requires it. It is possible to take advantage of other options, like consumer credit counseling. Before you take the drastic move of filling for bankruptcy and living with a long lasting bad credit history, make sure to consider using another way that may not be as damaging to your credit.
Don’t hesitate to give your attorney a heads-up about something she has missed. Lawyers are people too, and sometimes they forget important information and need to be reminded. This is your future in their hands, so don’t be scared to mention it.
Before filling for bankruptcy, determine which assets will be exempted from seizure. The Bankruptcy Code has lists of various asset types that are exempt during the process. It’s crucial to read that list before filing to see which of your prized possessions can be seized. If you don’t read this list, there is a chance that you might get nasty surprises when they take your things away.
Before making your decision to file for bankruptcy, double-check to see if other, less drastic options could make sense. If your debts are really not overwhelming, you may find the assistance you need by consulting a consumer credit counselor. You may also find success in negotiating lower payment arrangements yourself, but be certain to get any arrangements with creditors in writing.
Don’t hide from your friends and family while you go through bankruptcy. Bankruptcy proceedings can be extremely harsh. The long process can leave people stressed out and racked with guilt and shame over having their financial affairs laid out for everyone to see. A lot of people become depressed and withdrawn until their bankruptcy is discharged. But, isolating yourself from others could bring out more depression. Therefore, it is important that you continue to spend quality time with your loved ones despite, in spite of your current financial situation.
Consider all options before filing for bankruptcy. Talk with a bankruptcy lawyer and ask about alternatives, such as debt consolidation or negotiating with creditors. If foreclosure is imminent, see if your loan can be altered at all through a modification plan. 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. After all is said and done, your creditors will still want their money. For this reason, you may wish to investigate debt repayment programs in lieu of bankruptcy programs.
Chapter 7 Bankruptcy
Before you decide to file for Chapter 7 bankruptcy, consider how it could affect other people on your credit accounts, such as family members or business partners. Once you complete a Chapter 7 bankruptcy, you will be free of any responsibility of debt, which could put all responsibility on someone close to you. Although filing for bankruptcy excludes your from financial responsibility, co-signers will still be expected to pay the loan amount in full.
The road to personal bankruptcy is a sad and difficult one. However, what happens to your life after bankruptcy can have a happy beginning. Bankruptcy is not the end. Follow the tips given here in order to make it a new beginning.
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