It’s not a good sign when somebody is filing for bankruptcy. Bankruptcy can mean bad things and it is usually an embarrassing thing to mention to people when they ask about your financial status. If you decide to file bankruptcy, research the laws in your state and retain the services of a qualified attorney.
Most people that file for bankruptcy owe a lot of money that they could not pay off. If you find yourself going through this, you should know all about the laws that are in your state. Different states have different laws regarding bankruptcy. In some areas, your residence may be completely exempt, but in others, it will not be. Know what the laws are in your state before filing.
Don’t think that loading up your credit card with tax debt and then filing for bankruptcy is an answer either. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. In most cases, you can use the adage that “a dischargeable tax is a dischargeable debt.” So, there is no reason to use your credit card if it will be discharged in the bankruptcy.
Be sure you’re doing what’s right before you file for bankruptcy. It is possible to take advantage of other options, like consumer credit counseling. Your credit record will be harmed by a bankruptcy filing, and therefore prior to making such a decision, it is wise to investigate other options in order to minimize the damage you suffer.
When it gets time to think about bankruptcy, avoid using your retirement or savings to pay off the creditors or even make attempts to settle the debt. Avoid ever touching retirement funds until you have no other choice. Dipping into savings may need to happen, just don’t totally wipe it out, or you might not have much financial security later.
If you are meeting with a lawyer to discuss bankruptcy, the initial consultation should be free so ask every question you have. Free consultations are standard practice among bankruptcy lawyers, so interview multiple candidates before making a final decision. Make a choice only if you have received good answers to all the questions and concerns you brought to the table. You don’t have to make your decision right after this consultation. After your consultations, do some additional research on each attorney you consider qualified for the job.
Consider other alternatives before filing for bankruptcy. One example would be that a consumer credit program for counseling if you have small debts. Some creditors will work with you to help you pay off your debt with lower interest rates, lower late fees, or an extended loan period.
Before filing a bankruptcy claim, make sure that your home is well protected. Filing for bankruptcy does not mean you have to lose your home. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. You can also investigate your state’s homestead exemption, an option that might enable you to keep your home if certain financial requirements are met.
Chapter 7
Take into consideration all the ramifications of a Chapter 7 bankruptcy. Filing for this can impact any co-debtors, such as friends or family. You will be freed of responsibility for debts that you share if you make a successful Chapter 7 filing. Your creditors can then come after your co-debtor for full repayment of the debt.
Even if you are involved with Chapter 13 bankruptcy, it is still possible to get a mortgage or an automobile loan. It is more difficult. You will be required to meet a trustee and be approved for a new loan. Draft a personal budget to show that you will be able to repay your new loan. Be ready to justify the purchase that you need the loan for, too.
Bankruptcy is a difficult and stressful process, and you will need all the help you can get. In order to keep things together and protect yourself from excess stress, be sure to hire a competent attorney. Don’t make your choice to retain a particular lawyer simply because they are the cheapest. The cheapest attorney may not be the best, but the most expensive may not be the best either. Ask for referrals from folks who have filed and check reputations with the BBB. Try attending a hearing to find out how bankruptcy attorneys handle the situation.
If you have to file for bankruptcy, ensure that you supply all your financial information. Neglecting to include the smallest of detail can lead to a petition being dismissed. Add absolutely everything to your list, including small amounts. This may include secondary employments, vehicles you own and loans you still owe money on.
You do not always need to give in and file bankruptcy. Use the tips you just read to make the best decision possible. Use the information you have learned here, and see how you can revamp your finances and protect your valuable credit history.
This is a limited-time offer. We are not able to guarantee availability if you wait!
