How To Rebuild Your Credit After Filing Bankruptcy

Having too much debt can be a frightening experience. It’s not uncommon for debt to grow out of control quickly. Sadly, it is not as easy to fix it once you get there. The piece that follows does offer some guidance about how to handle bankruptcy when your burden becomes to much to bear.

Credit History

Don’t look at bankruptcy as a first step. Look at all the other options you may have first. You have other options available like consumer credit counselling services. Bankruptcy can leave your credit history permanently marked. Prior to doing this you need to be sure you try everything else first to get your credit history into shape and to lessen the impact.

Avoid exhausting your savings or emptying your retirement accounts to pay off creditors if you are considering filing for bankruptcy. Don’t touch retirement accounts unless you don’t have a choice. Using your savings is necessary, but decimating it and leaving yourself dangling with no future financial security is not a good idea.

Do not be afraid to remind your attorney of important specifics of your case. Don’t assume that he’ll remember something from a month ago; tell him again. Do not hesitate to speak up; this is your hearing and your future is on the line.

Before you decide to declare bankruptcy, make sure that a less-drastic solution isn’t more appropriate. Those with smaller debts may find use in a program for consumer credit counseling. You may have luck negotiating lower payments by dealing directly with creditors, but be sure to document any get and new agreement terms in writing from each creditor.

Chapter 7

You need to educate yourself on the differences between Chapter 7 and Chapter 13. Should you choose Chapter 7, your total debt load will be erased. Your responsibilities to your creditors will be satisfied. With a Chapter 13 bankruptcy, you will have to make payments for 5 years before the debts are forgiven. It is important that you understand the differences between the different types of bankruptcy, so that you can decide which option is best for you.

Prior to choosing a bankruptcy attorney, seek a free consultation with at least three attorneys. It is important to meet with the actual attorney, not the attorney’s assistant or paralegal; those people are not permitted to give legal advice Take some time to talk to different lawyers to find one that fits your needs, and meshes well with you.

There are two different kinds of personal bankruptcy you can file for: Chapter 7 and Chapter 13. Research them online to see the positive and negative aspects of each one. Learning about bankruptcy is not simple, so call a bankruptcy attorney to make an appointment to ask questions.

Think about all your options before pulling the trigger. Before filing, talk with an attorney who can help you weigh all of your options. If you are about to lose your house, talk to your lender about a loan modification. This type of plan allows your lender to work with you eliminating charges, extending your loan, and lowering interest rates to help you pay back the loan without drowning in debt. Because of the fact that creditors would like to see their money they are likely to offer repayment plans versus not getting paid at all if you file for bankruptcy.

If you really want to keep your vehicle, speak with your lawyer about possible choices. Chapter seven bankruptcy often provides for the lowering of payments. But, your car has to have been bought at least 910 days before you file. Also, it must come from a high interest loan and you have to have been consistently working.

An understanding of your rights is important before filing for bankruptcy. Bill collectors can try to scare you into believing that your debt will not be cleared. There are few debts that can’t be discharged. If a collector uses this tactic about debt that can, in fact, be discharged through bankruptcy, report the collection agency to the attorney general’s office in your state.

Act at the right time. In bankruptcy filing, timing is quite important. In some cases, you should file for bankruptcy right away, but in others, there may be reasons why filing quickly would be a bad idea. Talk with a bankruptcy attorney to find out the ideal timing for filing based on your particular situation.

Bankruptcy laws are very exact and very important, so ensure that you’re well aware of all current laws before you file a petition. You need to know certain things, like the fact that it’s illegal to transfer any asserts 12 months before filing your claim. It’s also prohibted to run up debt on credit cards just prior to filing.

List any debt you have. Only the debts you list on your bankruptcy filing will be discharged, so make sure all of them are included. Make sure you go through your records and be sure about the exact amounts. Take your time during this process; don’t rush and make sure all of your figures are correct.

It is important to list all debts when filling out your bankruptcy papers. Any debts you forget to list will not be discharged. Be certain to list all of your debts so that none that could have been discharged will be overlooked.

Be honest no matter what happens during your filing for bankruptcy. Lying about your assets and debts can get you into serious trouble. This is not legal. You may go to prison if you lie when recording your assets and debts.

Sometimes, life can throw you a curve ball that you were not expecting. In this article, you were presented with some tips on regaining control of your money and debt. Use what you’ve learned here to give yourself a second chance.