Just thinking about bankruptcy can frighten people. From fears of growing debt to worrying that they’ll no longer be able to provide for their families, people have good reasons to be scared. If you’re afraid of this scenario (or worse if you are living at), it is our sincere hope that the advice given here will be of help to you.
Do not try to get clever by paying your taxes via credit card before you declare bankruptcy in an effort to dodge your tax burden. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. Should the tax be dischargeable, the debt is often dischargeable as well. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
Think through your decision to file for bankruptcy carefully before going ahead with it. It is possible to take advantage of other options, like consumer credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.
Always be honest and forthright when it comes to your bankruptcy petition. Lying on your filing can cause dire consequences such as: delays, penalties, being prevented from re-filing, or even jail time.
Credit Cards
After a bankruptcy, you may not be able to receive any credit cards. If this happens, instead you should turn your attention to secured credit cards. This will show people that you are serious about getting your credit record back in order. If you pay your secured card off on time, you’ll eventually find that companies will start offering you unsecured credit.
If you are about to file for bankruptcy, then make sure you hire a lawyer. Bankruptcy is a complex process, and you probably don’t know all the information that is required to navigate it. An attorney that specializes in personal bankruptcy, can help guide you and make sure that your filing happens properly.
Before declaring bankruptcy, be sure you’ve weighed other options. One example would be that a consumer credit program for counseling if you have small debts. Negotiating with creditors is another option, but creditors are notorious for “forgetting” these agreements, so get them in writing!
Take advantage of the opportunity to consult with a number of bankruptcy lawyers who offer the first visit at no charge. Ensure that you have a meeting with a real lawyer instead of an assistant, since they can provide the best advice. It will be important to work with a bankruptcy lawyer that you feel comfortable with; a little comparison shopping will help you find the right one.
Learn the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. Go to a reputable website and research the benefits and detriments of each type of bankruptcy. If you have trouble understanding the wealth of information, talk to your lawyer so he or she can help you make an informed choice.
Chapter 13
Consider Chapter 13 bankruptcy. If you owe an amount under $250,000 and have a consistent income source, Chapter 13 may be right for you. When you file for Chapter 13, you can use the debt consolidation plan to repay your debts, while retaining your real estate and your personal property. Typically, this goes on for roughly three to five years, and once this time has expired, your unsecured debt is eliminated. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
If someone is scared of filing for personal bankruptcy, their feelings are completely legitimate. Though the fear may be great, you can alleviate some of that with this article. Take these bankruptcy tips to heart and start improving the lives of you and your family members.
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