Because of the way our economy works, driven by consumer debt, bankruptcy claims are becoming increasingly commonplace. Not only the economy, mind you, but people’s spending habits are also to blame for the increase in claims filed. Before deciding to seek bankruptcy, you need to know the right information and what to expect; that way, you will make better decisions. Keep reading for the knowledge you need.
If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. You should always keep money saved for worse times. Dipping into savings may need to happen, just don’t totally wipe it out, or you might not have much financial security later.
When it comes to informing your attorney about your case, don’t be fearful. Don’t assume that they will recall every detail that you go over with them without a friendly reminder. Ultimately, this is your bankruptcy and your financial future, so never hesitate to advocate on your behalf.
When choosing a bankruptcy lawyer, your best option is to find someone who is recommended by someone you know versus someone who you find online or in the phone book. There are lots of unsavory companies and lawyers out there who prey on people who are in desperate straits. It is up to you to find someone that is trustworthy and can make the process go smoothly.
If you’re going to file bankruptcy, you need an attorney. Bankruptcy is a complex process, and you probably don’t know all the information that is required to navigate it. A bankruptcy attorney can help yo,u and make certain you can do things the right way.
Chapter 13
Make sure that you understand the difference between Chapter 13 bankruptcy and Chapter 7 bankruptcy. Should you choose Chapter 7, your total debt load will be erased. All creditor relationships will be severed. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. It is important that you understand the differences between the different types of bankruptcy, so that you can decide which option is best for you.
Safeguard your home. Filing for bankruptcy does not guarantee that you will lose your house. For instance, if your home value has dropped recently, or even if you happen to hold a second mortgage, you may not necessarily lose the home. Otherwise, try looking into house exemptions that may let you remain in the home if you meet certain financial threshold requirements.
Once your initial filing is complete, it is time to take some time to relax a little. Bankruptcy is a stressful process: you will have to go over your bad financial decisions and perhaps feel ashamed about your decision. The stress of dealing with bankruptcy could cause you to fall into a depression, unless you take steps to take care of yourself. Your life will see improvement after you get past the bankruptcy.
Chapter 7 Bankruptcy
Think about any co-debtors you have prior to filing for Chapter 7 bankruptcy. Debts that involved a co-signer can be discharged in Chapter 7 bankruptcy. Although filing for bankruptcy excludes your from financial responsibility, co-signers will still be expected to pay the loan amount in full.
Even if you are involved with Chapter 13 bankruptcy, it is still possible to get a mortgage or an automobile loan. It is much harder. You will need to go through various hoops in order to be approved for any new loan type. It is important to make a budget and prove that you are able to afford the payment. They may also want to know why you believe you need the loan.
Before you file for bankruptcy, make sure you understand your rights. Don’t take a debt collectors word for it simply because they tell you that you can’t have many or all of your debts erased by bankruptcy. There are few debts that can’t be discharged. If you are told differently by a collector, research the information yourself. If you find they are in error, get the name of their company, phone number and any identifying info so you can report it to the attorney general in your area.
Personal Bankruptcy
Know the rules of personal bankruptcy prior to petitioning. You need to be aware of any issues you will encounter with the bankruptcy code. Some mistakes can even lead to your case being dismissed. Prior to filing any papers, learn about your rights and responsibilities when filing for personal bankruptcy. This can save you a lot of time and make the entire process easier.
In conclusion, bankruptcy is common these days, many times because of the way the economy is. By following the advice presented here, you can make sound decisions in regards to your relationship with personal bankruptcy.
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