Those who face personal bankruptcy sometimes feel negative emotions, like anger. Many people are worried about how they will get their monthly expenses paid. However, bankruptcy isn’t a process that will forever hurt your future.
Do not try to get clever by paying your taxes via credit card before you declare bankruptcy in an effort to dodge your tax burden. In some places the debt can not be discharged, and you may still need to pay the IRS afterward. Transferring the debt to another medium (e.g. a credit card) won’t magically make a tax debt discharagable, either. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
Before you decide to file bankruptcy proceedings, determine which assets will be safe. The Bankruptcy Code lists assets considered exempt from being affected by bankruptcy. It’s crucial to read that list before filing to see which of your prized possessions can be seized. If you aren’t aware of this, you could lose some assets that you value.
Familiarize yourself with the bankruptcy code before you file. Make sure to get the most up-to-date information concerning the bankruptcy laws in your state. To know what these changes are, go to your state’s website or contact the legislative offices.
Chapter 13
You may have heard bankruptcy referred to differently, either as Chapter 7 or Chapter 13. Learn the differences between the two before filing. In Chapter 7 most of your outstanding accounts will essentially be erased. Your ties with all creditors will get dissolved. 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.
Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. Be sure you go on the Internet and do your research to see what’s best for you. Before making any decisions, discuss the information you have learned with your lawyer.
Spend time with friends and family to keep your stress levels to a minimum through the bankruptcy filing process. The whole process of filing for bankruptcy is hard. It is extremely stressful and long, and it can leave you feeling ashamed of yourself. Lots of people choose to disappear for a while until the entire process is over and done with. However, this isolation will just make you feel worse, and it could cause you to be depressed. So, it is critical that you spend what quality hours you can with loved ones, regardless of your financial circumstances.
It is in your best interest to be abreast of your rights in petitions for bankruptcy. Don’t take a debt collectors word for it simply because they tell you that you can’t have many or all of your debts erased by bankruptcy. Most states allow for the majority of debt to be included on a bankruptcy. If you are told differently by a collector, research the information yourself. If you find they are in error, get the name of their company, phone number and any identifying info so you can report it to the attorney general in your area.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. You need to know certain things, like the fact that it’s illegal to transfer any asserts 12 months before filing your claim. Also, the filer can not increase their debt before filing.
Don’t spend too much time deciding whether or not you should file for bankruptcy. As with anything in life, putting off important things such as debt repayment can snowball quickly out of control. When you speak with a professional quickly, you will get valuable advice that will help to prevent your situation from spinning out of control.
After reading this article, hopefully you now know that bankruptcy does not have to mean doom and gloom. Though it is very difficult, personal bankruptcy is not the end. Follow the advice in this article for help in controlling your debt and deciding if bankruptcy is right for you.
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