Deciding to file for bankruptcy is serious and should be looked at seriously. Read this article to find out more about personal bankruptcy and get the information you need to make an educated decision. It’s important to prepare yourself by learning ahead of time.
Do not even think about paying your taxes with credit and petitioning for bankruptcy right after. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. Generally speaking, debt incurred to pay taxes and the tax bills themselves are treated the same in a bankruptcy. Just because your credit card could be discharged in bankruptcy does not mean you should use it.
Try to make certain you are making the right choice prior to filing your petition. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Bankruptcy has a negative effect on your credit reports, in that it is permanently there. Before you take this step, make sure all your options have been considered.
Prior to filing for bankruptcy, discover which assets cannot be seized. The Bankruptcy Code provides a listing of the various asset types that are not included in the bankruptcy process. Make sure to review the list before filing a claim so you know if your valuables will be subject to seizure. If you don’t read this list, there is a chance that you might get nasty surprises when they take your things away.
Don’t hide assets or liabilities when filing for bankruptcy. Wherever you file, that court has to be made aware of all details regarding your finances, positive and negative. Lay everything out on the table so that you and your lawyer can devise a plan to get you out of this mess.
Familiarize yourself with any new law before you make the final step to filing for bankruptcy. If you want to file for bankruptcy successfully, it’s important to review the latest applicable laws. They tend to change frequently. Your state will have a website to check, or a number you can call, to learn the latest changes in the bankruptcy laws.
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. All creditor relationships will be severed. If you file using chapter 13 bankruptcy, you will go through a sixty month repayment plan prior to all your debts being completely dissolved. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Since the majority of attorneys are willing to provide no-cost initial consultations, it is smart to meet with more than one before you make a selection. Always ensure that the person you meet with is a real lawyer, not a legal assistant or paralegal. These people can’t give legal advice. Seeking out different attorneys is all part of the process until you find someone that you can trust.
Safeguard your most valuable asset–your home. Just because you’re going bankrupt doesn’t mean that you also have to be homeless! If your home has significantly depreciated in value or you’ve taken a second mortgage, it may be possible to retain possession of your home. You are still going to want to check into homestead exemption either way just in case.
Learn how Chapter 7 bankruptcy and Chapter 13 bankruptcy differ from each other. Spend time researching the advantages and disadvantages of filing for each one of these. Before making any decisions, discuss the information you have learned with your lawyer.
If you’re concerned about the details of keeping your car, try to ask your attorney about details regarding lowering your monthly payments. Sometimes, as part of the bankruptcy filing, your auto loan can be restructured so that you pay less each month. You need to have bought your car 910 days before you file, have a loan with high interest and you’re also going to need a good work history.
Make sure you act at an appropriate time. When it comes to filing for bankruptcy, your timing is important. Sometimes you should file immediately; however, there are times when it is better to delay until the worst has passed. Speak with a bankruptcy lawyer about when the best time is to file for your specific needs.
Bankruptcy is a difficult time that always leads to lots of stress. To help yourself deal with this stressful situation, make sure you hire a legitimate attorney. Don’t allow cost to determine who you hire. Quality is far more important than expense when it comes to a good bankruptcy attorney. You can get good information about attorneys from friends,the internet and free consultations that most attorneys provide. You might even go to a bankruptcy hearing to watch how a lawyer presents his case.
File for bankruptcy before your finances get completely out of control. A lot of people ignore their financial problems, thinking they are going to go away; that is a big mistake. Being in debt can quickly put you into very deep hole and if you do not rectify the situation fast, you could face wage garnishment or even worse, foreclosure. As soon as you know that you are too far over your head, make the move to call an attorney skilled in bankruptcy court, to weigh your options.
As you are aware from the previous paragraphs, bankruptcy is not something that just happens. By going through the process correctly, the outcome will be further in your favor than it might otherwise have been. Take advantage of the advice in this article, and make sure everything you have is in order. With bankruptcy, you can’t be too careful.
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