Bankruptcy is a difficult decision for anyone to make; however, it is sometimes necessary. It’s best to make the decision of filing for personal bankruptcy after doing a little research and gaining a clear understanding of the topic. Continue reading for good advice from others that have filed for bankruptcy themselves.
Think twice if you have struck upon the idea of paying off your taxes by credit card and subsequently filing for personal bankruptcy. In most states, this is not dischargeable debt. Therefore, you will end up owing the IRS a lot of money. A common rule is that dischargeable tax means dischargeable debt. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
Ask yourself if filing for bankruptcy is the right thing to do. There are plenty of other options open to you, 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.
If you are feeling like you are seriously going to have to file for bankruptcy then do not clear out your savings. You should never touch your retirement accounts, unless you have absolutely no choice. You may need to withdraw some funds from your savings account, but don’t take everything that is there as you will be bereft of any financial backup if you do.
Secured Cards
After filing for bankruptcy, you could have trouble acquiring unsecured credit. Secured cards can be a great way to get started if this happens to you. They offer you the chance to demonstrate the seriousness with which you now take your financial obligations. When you have done well with secured cards for a while, you should be able to obtain an unsecured credit card.
Although you can find many bankruptcy attorneys listed in your local Yellow Pages or online, it’s best if you can find one through the personal recommendation of a friend, family member or acquaintance. There are way too many people ready to take advantage of financially-strapped individuals, so you must ascertain that your attorney can be trusted.
Keep with what you have decided to do. Filing for personal bankruptcy may possibly enable you to reclaim your personal property that have been repossessed, like your car, electronics and jewelry items. You should be able to get your possessions back if they have been taken away from you within 90 days before you filed for bankruptcy. Consult with a lawyer that can walk you through the filing process.
Many bankruptcy lawyers offer free consultations, so go to several before choosing one. Ensure that your meeting is actually with the attorney, not with a paralegal or an assistant. People in these positions are unable to offer legal advice. Look for an attorney until you find one you feel comfortable with.
Chapter 13
Consider Chapter 13 bankruptcy for your filing. If your total debt is under $250,000 and you have consistent income, Chapter 13 will be available to you. Filing for this type of debt will ensure that you can hold onto your real estate and personal property, and will let you develop a consolidation plan to pay off your debts. That plan lasts approximately three to five years, and then you are discharged from unsecured debt. Remember that if you fail to make any of the payments on time, the court may dismiss your case.
When you file for bankruptcy, you should be very aware of your rights. It is not unusual for creditors to claim that their debt is not able to be discharged. However, there are few debts that cannot be eliminated, like student loans and child support payments. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Nobody really wants to file for bankruptcy but it sometimes is just something they have to do. Now, equipped with the information from this article, you can handle the process much more completely. You will find this experience less difficult knowing that others have done it before you and survived by following these tips.
This is a limited-time offer. We are not able to guarantee availability if you wait!
