Dealing with bankruptcy is very tough. If you are saddled with financial hardship, it may seem that you have few alternatives. But, even those with damaged credit histories have options when it comes to securing homes and vehicles, as the following article explains.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. The Bankruptcy Code lists assets considered exempt from being affected by bankruptcy. Make sure to review the list before filing a claim so you know if your valuables will be subject to seizure. This will ensure that you do not have any surprises once you have filed bankruptcy.
Be honest when filing for bankruptcy. Don’t hide liabilities or assets, as they’ll come back and haunt you. Your attorney and trustee should be privy to all information about your finances. Do not hold back anything, and form a sound plan to make peace with your reality.
Educate yourself about state bankruptcy laws and possible outcomes before filing your petition. Laws are subject to change, and it’s important that you’re educating yourself about current code only. To find out about these changes, you can look at your state’s legislation website or contact their office.
Before making your decision to file for bankruptcy, double-check to see if other, less drastic options could make sense. For example, consumer credit counseling programs can help if your debt isn’t too large. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
Chapter 13
Do some research to find out more about Chapter 13 and Chapter 7. Chapter 7 bankruptcy is intended to wipe out all outstanding debts. You will be removed from any contracts you have with your creditors. Bankruptcy under the rules of Chapter 13, on the other hand, require you to work out a payment arrangement to pay back the agreed upon amounts. You need to be aware of the pros and cons of each type of bankruptcy so you can correctly select the best choice for your situation.
Be sure you know what the difference between Chapter 13 and Chapter 7 bankruptcy is. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. If something doesn’t make sense to you, go over it with your lawyer prior to choosing which one to file.
Consider Chapter 13 bankruptcy. If you owe an amount under $250,000 and have a consistent income source, Chapter 13 may be right for you. This will allow you to keep your personal property and real estate and repay your debts via a debt consolidation plan. These kinds of plans usually range across 3, 4 and 5 years. Once this is done, all your unsecured debt will get discharged. Keep in mind that missed payments will trigger dismissal of your case.
Your trustee may be able to help you secure an auto loan or get a mortgage even though you have filed Chapter 13. However, there are steps which must be taken to ensure you are within the law of bankruptcy. You will have to see your trustee and the approval for this new loan. When meeting with the trustee, bring a budget which shows that you will be able to afford the payment on the loan you are trying to get. You also have to prepare yourself to explain the reasons you need to buy the item.
Because of the comes from bankruptcy, you may feel overwhelmed and stressed. To have a reliable and trustworthy guide through the process, find a highly qualified attorney. Make your hiring decision based on several criteria, not just on price. What you need is a thoroughly competent lawyer, and this does not imply that you have to pay through the nose. Make sure that you verify their reputation through various sources including people in your circle of friends and the BBB. Try to get a referral from a trusted friend or family member.
Make a list of all your debts before filing. You can delay your bankruptcy process if you do not add in all important information. No sum is too small to be included; err on the side of caution and include everything. This may include secondary employments, vehicles you own and loans you still owe money on.
Regarding Bankruptcy
Pay attention to how you satisfy any personal debts before filing for bankruptcy. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and friends and family for up to one year. Do not make a decision about filing until you are aware of all the current rules regarding bankruptcy.
Bankruptcy is not a financial death sentence. Through the saving of money and striving to reestablish your credit, creditors will take this to heart. Start saving to see just how much of an impact the change makes when people see you go for a home or car loan.
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