Is Personal Bankruptcy The Right Choice For Me?

It is unfortunate that many people are currently facing bankruptcy. Thank you, economy! Before you begin to file bankruptcy, it’s imperative that you know how it works so you can make wise decisions. Read on to find insightful tips and information about bankruptcy filing.

Be certain you understand all you can about bankruptcy by researching reputable sites that offer good information. The United States Run a quick Internet search to find out all the different agencies you should be contacting or visiting via the web to find out what you can. The greater your body of knowledge, the better prepared you will be to make the decision of whether or not to file and to make certain that if you do file, the process is a smooth one.

You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. Most of the time, you cannot discharge this debt. As a result, you will owe the IRS a lot of money. In most cases, you can use the adage that “a dischargeable tax is a dischargeable debt.” So using your credit card to pay off your tax obligations, then filing for bankruptcy, can actually hurt you instead of help you.

Ask yourself if filing for bankruptcy is truly your best option. You have other options, including consumer credit counseling help. Bankruptcy will be on your credit report and affect your credit score for many years to come, so it is a decision that should not be taken lightly. Try to use it as a last resort.

When choosing a bankruptcy lawyer, your best option is to find someone who is recommended by someone you know versus someone who you find online or in the phone book. You want your bankruptcy to go smoothly, and the Internet is rife with fly-by-night companies whose only goal is to prey upon the financially desperate.

Ask for a free consultation with your bankruptcy attorney and ask questions about experience and education. Nearly all attorneys offer free initial consultations, so you should be able to meet with a few before you make a final hiring decision. Do not make any final decisions until every question you have has been answered. There is no need to feel rushed to decide to file after you talk with your bankruptcy lawyer. That gives you the chance to speak to a number of lawyers.

Make sure your home is safe. Filing for bankruptcy does not mean you have to lose your home. Whether you get to keep your home depends on a few things, including its value and whether you have debts like a second mortgage or HELOC. If this is not the case, find out more about Homestead Exemptions you might qualify for if you meet certain financial requirements.

If you’re unsure, then you need to learn what a Chapter 7 bankruptcy can do for you, as opposed to what Chapter 13 does. Take time to research this online and see the pros and cons for filing each one. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.

Ensure that you bankruptcy is your best choice. Some people have great luck with handling debt with debt consolidation, which means taking out only one loan to pay off many loans. Declaring bankruptcy is a very involved process that can cause a good deal of anxiety. Remember that your credit will be affected by the mark of personal bankruptcy for a long time. Because of this, filing for bankruptcy should only be used as a last resort.

Chapter 13

Consider filing a Chapter 13 bankruptcy. With a regular income and unsecured debt below $250,000, Chapter 13 is probably best for you. The benefit of this plan is that you retain personal belongings and private real estate and your debts are repaid by an organized payment plan. Typically, this goes on for roughly three to five years, and once this time has expired, your unsecured debt is eliminated. Just know that missing one payment could cause your case to be dismissed.

Avoid filing for bankruptcy if you make more money than your monthly bills. Although bankruptcy may feel like a simple method of getting out of your large debt, it leaves a permanent mark on your credit history for up to 10 years.

Facing bankruptcy is a negative situation that can bring on stress. Look for a good attorney who can help you through the process. Make your hiring decision based on several criteria, not just on price. Think about quality rather than cost when hiring an attorney. Look to the bureau for better business, consultation, as well as others who have formerly experienced bankruptcy for more information about lawyers. Often, watching a bankruptcy proceeding can give you clues to the quality of a lawyer.

Before you file for bankruptcy, be sure you know how to properly repay your debts. Bankruptcy laws generally don’t cover situations which occurred within a short time frame prior to filing, such as the previous 90 days worth of credit card debt. So, before you ultimately decide to file a claim, be sure that you understand the rules in place.

As you learned from the introduction of the article, bankruptcy is growing a lot these days, especially since the economy is slowly rebuilding. To make sure the best decisions are being made in terms of bankruptcy, use this advice.