It’s not fun to file bankruptcy. If you are contemplating filing for bankruptcy, it means that you are in a dire financial situation. If you decide to file bankruptcy, research the laws in your state and retain the services of a qualified attorney.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. The Bankruptcy Code lists assets considered exempt from being affected by bankruptcy. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. It is important to know what types of possessions may be taken away before they actually are seized.
Don’t hide assets or liabilities when filing for bankruptcy. When you file make sure whoever is handling the process is fully aware of each and every financial detail. Being honest is both the right thing to do and, moreover, it is required by law.
Make sure your home is safe. You do not have to lose your home in the process of a bankruptcy. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. If you meet certain criteria, you may be able to retain ownership of your home even after filing for bankruptcy.
Initial Filing
Do not forget to enjoy life a little once you get through the initial filing process. It can be several months between the initial filing and the final discharge of debts. That stress can lead to depression, if you don’t take the right steps in fighting it. Once your petition is in the hands of the judge, all you can do is wait.
It is important to understand your rights when you file for bankruptcy. Certain unscrupulous creditors will try to convince you that certain debts can’t be discharged in bankruptcy. Only a few kinds of debt, like student loans or child support, are ineligible for bankruptcy. If any debt collectors tell you that their debts can’t be bankrupted, make a report with your state attorney general.
Refrain from feeling shameful about your bankruptcy. You may need to get credit counseling or simply learn how to balance your budget. Continuing to let yourself feel that way can damage your emotional health and does not benefit you in your endeavors to deal with your financial situation. A good way to deal with bankruptcy is to make sure that you keep a stiff upper lip.
Credit Counseling
Consider any other options available before filing for personal bankruptcy. You may want to consider credit counseling. You can get assistance from non-profit companies. They will make arrangements with your creditors so you will have lower payments as well as lower interest rates. The payments you make go to the credit counseling company, and they send that money to your creditors.
Go over the debts you are currently paying off before filing for bankruptcy. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and friends and family for up to one year. Do not make a decision about filing until you are aware of all the current rules regarding bankruptcy.
It may be counterintuitive, but in some cases, pulling the trigger and filing for bankruptcy may have better credit consequences than continuing a pattern of credit delinquencies. Yes, the bankruptcy will stick around for a whole ten years, but the clean slate you get from filing will help you get back on the right track quickly. The main benefit to filing for bankruptcy is the chance at a new start.
Credit Cards
Although it is tempting to toss out the idea of ever owning credit cards again, think again. This is not wise, since credit cards can help to rebuild credit. If you do not rebuild your credit rating, you will not be able to buy a car or a home on credit again. One credit card is adequate to begin rebuilding your credit rating.
When you file for bankruptcy, it doesn’t mean that you will lose your assets. Personal belongings that fall under private property are something that you can keep. This includes items, such as jewelry, clothes, household furnishings, electronics, etc. Depending on your financial situation and what state you live in, you might be able to keep property such as your home and car, or even recover property that has been recently repossessed.
Exercise some care when you pick a lawyer to help you file for bankruptcy. There are a disproportionate number of inexperienced lawyers working in the bankruptcy field. Be certain your attorney has enough expertise and has a valid license. Be sure to look them up online, as you will be able to see their disciplinary record, background information, and ratings from previous clients.
As you can now see, you do not have to let bankruptcy consume your soul. The information contained in this article can help you to avoid having to file for bankruptcy. Apply the guidance you just received and see what it can do to improve your financial circumstances and bolster your credit record.
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