Most people never expect to be in the position of facing bankruptcy. In some situations, this is the only choice, and learning about the process is crucial. If this has happened to you, then use the advice in this article to move forward with your life.
Before undertaking the bankruptcy process, ensure you have made the correct decision. You have other choices, including consumer credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.
Be completely honest whenever you file for personal bankruptcy. Hiding any asset or liability is a risk that will bite you in the end. Whoever provides your legal consultation must be privy to all of your financial information. Keeping secrets or trying to outsmart everyone is not a wise move.
There is hope! Filing for bankruptcy may allow you to get back property, such as an auto, jewelry, or electronics, that you may have had repossessed. If you have any property in repossession that was taken less than three months before filing for bankruptcy, then there are good odds that you can get your property back. Speak with your attorney about filing the correct petition to get your property back.
Consider other alternatives before filing for bankruptcy. For example, there are credit counseling services that can help you to deal with smaller amounts of debt. It is also possible to do your own debt negotiations; however, be sure to get everything in writing.
Chapter 7
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. In Chapter 7 most of your outstanding accounts will essentially be erased. This includes creditors and your relationship with them will become no longer existent. With a Chapter 13 bankruptcy, you will have to make payments for 5 years before the debts are forgiven. It’s crucial that you know the differences between all of the various kinds of bankruptcies so that you may choose the best option for your situation.
Before filing a bankruptcy claim, make sure that your home is well protected. Filing for bankruptcy will not always result in losing your home. Check your home’s current value to see if it has gained equity and get your first and second mortgage papers together. You may also want to check out the homestead exemption because it may allow you to keep your home.
If you’re unsure, then you need to learn what a Chapter 7 bankruptcy can do for you, as opposed to what Chapter 13 does. Research both types of bankruptcy online, and weigh the positives and negatives each would offer you. 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.
Learn what you can about Chapter 13 bankruptcies. With a consistent income source and less than $250k in debt, try filing for Chapter 13. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. The plan is usually for a term of three to five years, and a discharge will be granted at the end of that term. Remember that missing a payment to the plan will result in your case being dismissed.
Before you file for personal bankruptcy, weigh all of your options. You might be able to address your debts by arranging a repayment plan or a reduction in your interest rates. Get professional advice on these matters from a bankruptcy lawyer. Various loan plans out there can be a lifesaver if you’re facing a foreclosure. Your creditors will be willing to work with you to allow you to pay off your debts. They may be able to take late fees off of your account, cut down your interest, or even extend the loan’s repayment period. Creditors would rather be repaid, however slowly, than have you declare bankruptcy.
Although the entire process can be stressful, do not allow the stress to take over. After filing, many people find themselves stressing over their situation and how to fix it. The stress of dealing with bankruptcy could cause you to fall into a depression, unless you take steps to take care of yourself. Life will get better after you finally get this situation over with.
Chapter 7
When you are looking at a Chapter 7 personal bankruptcy, you may well have debts to worry about for which you share responsibility with another person, such as a spouse, family member, or business partner. Once you complete a Chapter 7 bankruptcy, you will be free of any responsibility of debt, which could put all responsibility on someone close to you. Although, your creditors may insist that the co-debtor pay off the entire debt.
You should get some advice on bankruptcy if you decide you to file. Learning more about the subject will help you through the toughest of times. Don’t forget to implement the tips and tactics you have read above in order to help you when filing a bankruptcy claim.
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