The national economy remains in poor condition. Because more people are out of work, more people are also falling into debt. Rising personal debt leads, in many cases, to increased bankruptcy filings. If you or a loved one is considering bankruptcy, find out what to do about this situation by reading this article.
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. Avoid ever touching retirement funds until you have no other choice. Your savings accounts offer valuable financial security so try to leave them intact.
When you document your financial records, it is vital that you are 100% truthful in order to have a successful resolution to your bankruptcy process. To avoid problems, penalties and future re-filing bans, resist the urge to hide documentation or assets.
Do not attempt to conceal any assets when filing for bankruptcy because you may be penalized when they are discovered. It is necessary to be open regarding both the positive and negative aspects of your financial life. Bankruptcy can be a chance to simplify your finances, but any schemes you employ to conceal the truth can ruin that chance for you.
Any bankruptcy consultation should be free of charge. Almost all lawyers will give a free consultation, so meet with more than one before making a decision on whom to hire. Choose an attorney who is experienced, educated and well-versed in bankruptcy laws. You do not have to give them your decision right after the consultation. So, this gives you plenty of time to consult with several attorneys.
It is imperative that you know for sure that bankruptcy is the option you need. Consolidating current debt could make it easier to manage. Bankruptcy is a long process that can be stressful. It will have a major effect on your credit as time goes on. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.
Make sure bankruptcy is truely your only option before filing. Speak with an attorney who specializes in bankruptcy to find out if alternatives, such as a debt repayment plan or a reduction of your interest rates, might be better for you. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. These plans allow you a longer pay off period by extending the term of the loan, reducing the rate of interest or forgiving late fees. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Remember to have fun with your life when you’re done with the filing process initially. Bankruptcy is a stressful process: you will have to go over your bad financial decisions and perhaps feel ashamed about your decision. This stress could morph into clinical depression, if you fail to adequately address the problem. Your life will most likely improve once you’re over this hump, so relax.
If you decide to file for bankruptcy, it’s important that you’re educated about your rights. Some bill collectors will tell you that your debts can’t be bankrupted. What you can’t file on is very small, like student loans or child support payments. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Even though our economy is slowly improving, many people still do not have jobs or decent wages. That said, it is possible to avoid bankruptcy even if you are having cash flow problems. Bankruptcy can be a difficult journey; however, the process can be made easier by learning the aforementioned information. May good fortune be with you.
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