Bankruptcy is stressful and unpleasant, but remember that it is also a solution and a light for the future of your finances. There is the need for all your finances to be exposed, and multiple people scouring your financial information. This may be very uncomfortable; however, after your bankruptcy case has been completed, you can start anew free from the hassles of bill collectors. This article will give you some great tips to help ease the bankruptcy process.
Be certain to gain a thorough understanding of personal bankruptcy by using online resources. The United States Department of Justice, American Bankruptcy Institute, along with many other websites can provide you with the information you need. The more information you have, the more confident you can be about any decision you make and you will know that you are doing the best thing possible for your situation.
Honesty is of utmost importance during your filing, even though it may be tempting to “pad” your answers a little. Withholding or lying about certain information can seriously worsen your financial situation. It could lead to being unable to file for bankruptcy or even legal trouble.
If you can, get a word-of-mouth referral for a lawyer. Don’t be taken in by some fly-by-night company that exists only to profit from the suffering of others. Check out any lawyer you are considering thoroughly before engaging him or her.
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 bankruptcy, your debts are all eliminated. Any ties that you have with creditors will be dissolved. 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 determine which type of bankruptcy is right for you given your unique financial situation.
Most bankruptcy lawyers give free consultation, so try to meet with these types of lawyers before deciding on hiring one. Ensure that your meeting is actually with the attorney, not with a paralegal or an assistant. People in these positions are unable to offer legal advice. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
Don’t file for bankruptcy unless it’s absolutely necessary. Perhaps consolidating your existing debt can make it easier to manage. Filling for bankruptcy is a lengthy, stressful process. It will certainly affect the credit rating that you have in the future. So, consider bankruptcy only as a last resort when you have no other choice.
Spending time with the people you love is something you should do now. Bankruptcy proceedings can be extremely harsh. The long process can leave people stressed out and racked with guilt and shame over having their financial affairs laid out for everyone to see. Most people adopt a very negative attitude toward bankruptcy. Pulling away from people who care for you will not help the situation, and can cause your negative feelings to intensify. Because of this, it’s vital you keep spending some time with the people you love despite what you are currently going through.
Don’t automatically assume that bankruptcy is your only option. Find out if you can receive a reduced interest rate or altered repayment plan instead of bankruptcy filing. For example, if you are in talks of foreclosure, you could use a modified loan to overcome your debt. 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. Remember that creditors desire to get paid and usually debt repayments are often preferable when dealing with bankrupt debtors.
Bankruptcy is characterized by both positive and negative aspects. Each person has their own reasons to file. Your job is to make sure you keep all the information you can on hand, as you progress. The information you just read will greatly simplify the bankruptcy filing process. Use these tips during the process and feel a little better about it.
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