Bankruptcy can be stressful and it can also bring relief. On one hand, people will be scrutinizing your private financial affairs. However, when your bankruptcy is over, you can re-establish your finances and no longer need to tolerate bill collectors. This article is filled with useful tips to help you get through bankruptcy.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
You may end up losing more than you bargained for when you file a bankruptcy claim, so be sure that you know just which assets may be taken before filing. The Bankruptcy Code includes a list of the types of assets that are exempt from the bankruptcy process. It is vital that you completely understand which assets are protected and which assets can be seized prior to filing bankruptcy. If you aren’t aware of this, you could lose some assets that you value.
Don’t pay for an attorney consultation and ask him or her anything you want to know. Free consultations are standard practice among bankruptcy lawyers, so interview multiple candidates before making a final decision. Choose an attorney who is experienced, educated and well-versed in bankruptcy laws. It is not necessary to decide immediately after your consultation. You have lots of time for consulting with other lawyers.
Most bankruptcy lawyers offer a free consultation, so meet with several before you decide on one. Be certain that the person you meet with is really a lawyer. Avoid meeting with paralegals or legal assistants because they cannot give you legal advice. Looking for an attorney will help you find a lawyer you feel good around.
Credit Score
If your paycheck is larger than your debts, avoid filing for bankruptcy. You should know that filing for bankruptcy will ruin your credit score for at least ten years and that improving your credit score will be expensive.
Before declaring bankruptcy, see if there’s anything less drastic you can do to repair your credit. A lawyer that specializes in bankruptcy law can help advise you of other options, such as repayment plans and reducing interest rates to relieve some of the burden. Loan modification plans can help if you are dealing with foreclosure. This type of plan allows your lender to work with you eliminating charges, extending your loan, and lowering interest rates to help you pay back the loan without drowning in debt. When all is said and done, the creditors want their money, so sometimes it’s best to deal with a repayment plan than with a bankruptcy debtor.
Once the initial filing period is over, ensure that you are getting out and enjoying life. The filing process is extremely stressful for a lot of the people who go through it. If you let the stress get to you you may get depressed if you’re not doing the proper things to fight it. Life will get better after you finally get this situation over with.
If you really want to keep your vehicle, speak with your lawyer about possible choices. Often, you can negotiate a lower payment through bankruptcy. Your car must have been purchased more than 910 days prior to filing, be a high interest loan, and you must have had a steady work history for this to work.
Keep in mind that filing for Chapter 7 bankruptcy may affect other people than just you, including family members, and in some cases, business associates. If you choose Chapter 7, you are no longer responsible for joint debts. However, creditors can demand co-debtors pay the amount in full.
It is important to understand your rights when you file for bankruptcy. Occasionally, debt collectors will attempt to convince you that your debt isn’t eligible for bankruptcy. There are few debts that can’t be discharged. If the bill collector is trying to deceive you, then report that company to your local attorney general’s office.
Make sure the time is right when you file a bankruptcy claim. When it comes to filing for personal bankruptcy, timing is everything. In some cases, it is better to file immediately, while other situations benefit from trying to get certain finances in better shape before filing. The professional advice of a bankruptcy lawyer can help you pin down the best time to file given your current financial state.
If you know that you are about to file for bankruptcy, don’t exploit the information asymmetry and get huge cash advances on your credit cards. Not only is this fraud, but you could end up having to pay back the money, even once you have filed for bankruptcy.
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. By speaking with a professional in a timely manner, you can get good advice before the bankruptcy process gets too difficult.
Do your research before hiring a bankruptcy attorney. You do not want to hire someone who is new to the field of bankruptcy. Make sure that the lawyer you decide to hire has years of expertise and is properly licensed. You can check histories of attorneys online, including disciplinary records and backgrounds.
There are good things as well as bad, in regards to filing for bankruptcy. Just know that what you learn today is going to help you out a lot in learning about bankruptcy. You will have an easier time with your bankruptcy filing thanks to this article’s tips. Incorporate these tips into the process and watch how much better you feel.
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