Bankruptcy is an experience nobody ever expects to happen to them. People can do their best to stay on top of finances, and when one or more financial emergencies come at them, they find that they have no choice but to look into bankruptcy. This article will give you some great advice to help decide if filing for bankruptcy is the right option for you.
When it soaks in that filing for personal bankruptcy, don’t use all of your retirement funds, or all of your savings to resolve insolvency or pay creditors. Do not tap retirement accounts unless there is no other alternative. While you may have to use a part of your savings, never completely wipe it out which would only leave you in worse financial shape in the future.
Don’t be afraid to remind your attorney of certain details in your case. Do not assume that if you’ve already told him or her something important once, that they will remember it later without a reminder. Remember that you’re the boss. You’re paying your lawyer, so you should not be afraid to have your say. After all, the quality of your life hangs in the balance.
Be aware that getting unsecured credit is going to be tough once you’ve gone through bankruptcy. If you are in this situation, applying for a secured card may be the answer. They offer you the chance to demonstrate the seriousness with which you now take your financial obligations. It will take time, but when creditors see a pattern that satisfies their need to see your good faith with payments, you will then be able to apply for unsecured cards.
Do some research to find out which assets you could lose by filing for personal bankruptcy. There are some assets that cannot be seized through bankruptcy, and the law lists those assets. It is important that you read this list before filing for bankruptcy, so that can find out whether or not your most prized possessions will be seized. 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.
Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask a lot of questions. Since most attorneys offer free consultations, meet with a few attorneys before deciding who to hire. Make your decision after all of your questions have been answered. It is not necessary to make a final decision right away. You have lots of time for consulting with other lawyers.
Before you file, make sure you understand current bankruptcy laws. The laws are constantly undergoing changes, so you must stay on top of them if you are going to file for personal bankruptcy correctly. Your state’s legislative offices or website will have up-to-date information about these changes.
Before declaring bankruptcy, be sure you’ve weighed other options. If you owe small amounts of money, you can join a counseling program or straighten your finances out by yourself. Also, if you just contact your creditors and speak to them plainly and truthfully, the odds are good that you can negotiate a better payment structure that you can afford.
Chapter 13
Remember to understand the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. Chapter 7 eliminates all debts. Any ties that you have with creditors will be dissolved. 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. You need to determine which type of bankruptcy is right for you given your unique financial situation.
Before filing a bankruptcy claim, make sure that your home is well protected. Bankruptcy filings don’t necessarily have to end in the loss of your home. There are mitigating factors, such as lose of value, or multiple mortgages. It can be worthwhile to understand the homestead exemption law to see if you qualify to keep living in your home under the financial threshold requirements.
You should get some advice on bankruptcy if you decide you to file. Learning more about the subject will help you through the toughest of times. Don’t forget to implement the tips and tactics you have read above in order to help you when filing a bankruptcy claim.
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