If you have more debt than you could ever hope to pay off, you might feel like your life is over. It seems as if one little debt somehow ballooned into catastrophic debt. Unfortunately, once you’re in this situation, fixing it can be hard. You might consider bankruptcy, look through this article and find out why.
Knowledge is power when you’re considering bankrupcy; there are many websites available to help you. The United States DoJ along with other private and nonprofit organizations all have insightful knowledge. The more you know about it, the better you are able to make the best decision for your situation and to make sure that the bankruptcy proceedings move forward with minimal setbacks.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. Generally speaking, taxes are not a dischargeable debt. The delays caused by this sort of tactic could leave you owing the IRS a great deal in interest and penalties. Bear this in mind; if the tax can be discharged, then the debt can be as well. Therefore, you have no reason for use of a credit card, if the amount is to be discharged in due process of the bankruptcy.
If you know people who have filed for bankruptcy, ask them who they would recommend rather than relying on Internet reviews or worse, just randomly picking someone out of the phone book. There are many companies who take advantage of financial desperation; that is why it is important that you get someone that is trustworthy.
Bankruptcy is tricky and hiring a good lawyer will be a must. There are a lot of things to do during bankruptcy and that may be hard for you to understand on your own. A bankruptcy attorney can advise you on how proceed properly.
Protect your house. Filing for bankruptcy does not guarantee that you will lose your house. You can still keep your home, it just depends on your specific situation and the value of your home. If you’re not sure, however, you can always study the particular homestead exemption regulations. You will learn everything you need to know.
There are differences between Chapter 13 bankruptcy and Chapter 7; be sure to familiarize yourself with both. Take the time to find out about each one online, and look at the advantages and disadvantages of each. If you are confused by what you find, be sure to ask your attorney to explain anything that is unclear before you make your decision about filing.
Be around family as much as possible. The process of bankruptcy can seem brutal. This long and stressful process can leave a person feeling guilt ridden, unworthy and ashamed. Many people decide to hide away from the world until the process is over. Pulling away from people who care for you will not help the situation, and can cause your negative feelings to intensify. It’s imperative that you spend as much time with loved ones as you can, even in the midst of your financial dilemma.
Filing for bankruptcy should not be done on a whim. There are many other options including debt consolidation and making payment plans with your creditors. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. This type of plan allows your lender to work with you eliminating charges, extending your loan, and lowering interest rates to help you pay back the loan without drowning in debt. 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.
Do not wait until things go from bad to worse before filing bankruptcy. The judge reviewing your petition will consider your recent behavior, purchases, income and payments when making a decision. Debts can multiply very quickly, and can result in you losing money to wage garnishment, or even losing assets that are part of a secured loan. When you find that you cannot take care of your debts anymore speak with an attorney for bankruptcy to talk things over.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. For instance, for 365 days before filing, no one is able to receive assets from the filer. Also, a person cannot legally increase their debt amount on credit cards prior to filing.
Sometimes, life can throw you a curve ball that you were not expecting. Apply the advice from this article to help yourself better understand filing for bankruptcy. Take the advice that was given and make a difference in your life.
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