Many people think people who file for bankruptcy are deadbeats, but change their tune when their debts become untenable. A simple change of circumstances, such as job loss, can quickly change a life to the point where bankruptcy may be the only way out. Whatever your reasons for filing bankruptcy, the article below can help.
Bankruptcy Laws
Lots of people have to claim bankruptcy when their bills are larger than their income. If this describes your situation, it makes sense to become familiar with relevant laws. You will find that each state has their own bankruptcy laws. Your house is safe in certain states; however, in other states, it isn’t. Be aware of bankruptcy laws before filing your claim.
Knowledge is power when you’re considering bankrupcy; there are many websites available to help you. The United States Department of Justice, NACBA, and American Bankruptcy Institute websites are all great places to go for up-to-date information. 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.
Do not use a credit card to manage your tax issues and then try to file bankruptcy. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. The rule here is that if you can get the tax discharged then you can get the debt discharged. So, in short, do not use your credit cards to pay off debts right before you file for bankruptcy.
Credit History
Exhaust every other option before making the decision to file for personal bankruptcy. There are plenty of other options open to you, like consumer credit counseling. Bankruptcy is a serious negative on your credit history so make sure you have no other options before you file. It is important to keep your credit history as positive as possible.
Don’t be afraid to remind your lawyer about important aspects of your case. Inaccurate or incomplete information can lead to your petition being denied. This is your bankruptcy and your future, so never be nervous about speaking your mind.
When looking for a lawyer to handle your bankruptcy claim, the best way to go is off of a personal recommendation instead of simply flipping through the phone book. There are so many dime-a-dozen companies out there who make it a practice of preying on financial desperation. You need to make sure your bankruptcy goes smoothly, so find someone you know you can trust.
Be sure your home is well protected. Filing for bankruptcy will not always result in losing your home. It depends what your home value is and if there is a second mortgage, as all this stuff comes into play when determining if you can keep the home. There are also homestead exemptions which, depending on your other finances, may allow to remain in your home.
Spend time with loved ones. Bankruptcy can really wear down your emotional reserves. It is long, hard and sometimes leaves people feeling guilty or ashamed. Avoidance of friends of family during the process is not uncommon. However, becoming a hermit will only increase feelings of self-doubt and could make you depressed. Because of this, you need to make sure you spend as much time as you can with your family and friends, even if you are ashamed of your finances.
Debt Repayment
Look at all the alternatives to bankruptcy before filing. Speak with an attorney who specializes in bankruptcy to find out if alternatives, such as a debt repayment plan or a reduction of your interest rates, might be better for you. Loan modification can help you get out of foreclosure. Some lenders will make concessions rather than losing the money owed to bankruptcy. These concessions include waiving late fees, lowering interest rates, and changing the loan term. After all is said and done, your creditors will still want their money. For this reason, you may wish to investigate debt repayment programs in lieu of bankruptcy programs.
Once you have tried every approach to your finances and still find no solution, you may find it necessary to consider bankruptcy. You need not stress out, if your circumstances have brought you here due to things outside your personal control. You will find that this article contains very valuable information.
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