The mere thought of bankruptcy is enough to strike fear into the hearts of people. From fears of growing debt to worrying that they’ll no longer be able to provide for their families, people have good reasons to be scared. Does the thought of this scare you? Perhaps you are going through it right now, and the advice found here can help your situation.
Ask yourself if filing for bankruptcy is the right thing to do. You have other options, including consumer credit counseling help. 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.
Retirement Accounts
If you are faced with the choice of filing for bankruptcy or using your emergency fund or retirement accounts to pay creditors, opt to file for bankruptcy. You should never touch your retirement accounts, unless you have absolutely no choice. Using your savings is necessary, but decimating it and leaving yourself dangling with no future financial security is not a good idea.
It’s not uncommon to learn soon after bankruptcy that you are unable to get an unsecured credit card easily. Look into getting a secured credit card in order to get back on your feet with building credit. This will allow you to start building a good credit history while minimizing the bank’s risk. After a while, you may be able to get unsecured credit again.
Be persistent in researching information about filing for bankruptcy and consult a qualified personal bankruptcy attorney. You might even be able to get back secured property that has been repossessed in the 90 days before filing. If the property you own has been repossessed under 90 days before the bankruptcy filing, you may still be able to get it back. Speak with your attorney about filing the correct petition to get your property back.
Learn about teh differences between Chapter 13 and Chapter 7 bankruptcy. Do some research about these options so you can choose the best one. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.
Chapter 13
Consider filing for Chapter 13 bankruptcy. You are probably eligible for Chapter 13 if your income is consistent and your unsecured debt is under $250,000. When you file for Chapter 13, you can use the debt consolidation plan to repay your debts, while retaining your real estate and your personal property. This plan normally lasts from three to five years, in which you’ll be discharged from unsecured debt. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
Bankruptcy should not be filed by anyone who makes more than their bills cost. Bankruptcy may seem to be the easy way out, but your credit report will show the scar for the next ten years.
If you plan on filing bankruptcy, never wait too long. Some people will just ignore their outstanding debts, hoping that someone or something will come and save them, but this never ends well. It is too easy for debt to mount up and become uncontrollable, which could lead to loss of assets or wages. When you find that you cannot take care of your debts anymore speak with an attorney for bankruptcy to talk things over.
If you have to file for bankruptcy, ensure that you supply all your financial information. If you forget information you run the risk of having your petition delayed, or possibly even dismissed. Add every summer, no matter how insignificant, to your documentation. Anything, like a job on the side, assets, like cars, and any outstanding loans should be included.
Don’t stress about trying to determine whether bankruptcy is something you must do. Your debt will only continue to mount as you waiver on the decision, difficult as it might be. Talk to a lawyer as soon as you can to get the advice that you need.
Don’t wait until after filing for bankruptcy to become more responsible with your finances. Avoid running up current debts or taking on new debt just before filing for bankruptcy. Both creditors and judges take a look at what you are doing now, as well as what you have done in the past. Try demonstrating that your current behavior and financial habits have positively changed.
Produce a comprehensive list of everything you owe. After this, you can file bankruptcy, so make sure this document is accurate. Make sure you go through your records and be sure about the exact amounts. Do not rush through this process; if you want the amounts discharged, you have to get those numbers right.
Go to a bankruptcy lawyer for advice, instead of filing on your own. Your lawyer can determine if you eve need to file, and if you do, act as an advocate in court and make the process go more smoothly. Also, a lawyer can assist you with paperwork and give you the answers you are looking for.
Always document all the debts you want to be eliminated. Any debts omitted from the paperwork will not be covered in the discharge. It’s your responsibility to ensure everything is written down to avoid getting charged for debts that can be discharged.
One common contributing factor for bankruptcy is the financial consequences of filing for divorce, so make sure to consider your plans carefully. Many people file for bankruptcy right after getting divorced because they cannot deal with their financial hardships. It is always wise to think twice about divorcing.
Chapter 7
If you file a Chapter 7 bankruptcy only to find that you are not qualified to use the homestead exemption, you might be able to put place your mortgage in a Chapter 13 case. Some scenarios will require a conversion from Chapter 7 to Chapter 13, dependent on what your attorney says.
Those who are afraid of bankruptcy are entirely justified; it often can be a frightening experience. Though the fear may be great, you can alleviate some of that with this article. Using the personal bankruptcy advice in this article can help improve your financial situation.
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