Dealing with bankruptcy is a very hard situation. If you are thousands of dollars in debt, you may not have many options. Your future lending requirements will not be permanently hindered by bankruptcy, read on to find out why.
Although you can find many bankruptcy attorneys listed in your local Yellow Pages or online, it’s best if you can find one through the personal recommendation of a friend, family member or acquaintance. 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.
Prior to declaring bankruptcy you really need to be sure that you’ve exhausted all your other options first. For example, if your debt is small, try a type of consumer counseling program. You may have the ability to negotiate much lower payments, just be sure any debt modifications you agree to are written and that you have a copy.
Be sure you know what the difference between Chapter 13 and Chapter 7 bankruptcy is. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. Once you have done your own research, be sure to review your findings with your lawyer, who is the expert. This way, you can be sure of making a well informed choice.
Chapter 13
Chapter 13 bankruptcy might be a good option, so don’t overlook it. If you have regular income and under $250K in unsecured debt, a Chapter 13 may be right for you. Filing a Chapter 13 will let you keep personal items and real estate while you pay down your debt in a consolidation plan. Lasting anywhere from three to five years, this plan will allow you to be discharged from unsecured debt. Keep in mind that even missing one payment can be enough for your whole case to get dismissed.
If keeping your vehicle is of great concern, ask your lawyer if you can secure a payment modification. Chapter 7 bankruptcy is one of the most common and effective. There are qualifications, such as the loan being high interest and a good work record for this option.
Keep the concept of shame out of your head if you are contemplating bankruptcy. Bankruptcy can sometimes leave people feeling guilty, ashamed and alone. These feelings do not help you and provide no value. If you are filing for bankruptcy and you are thinking negatively about the situation, make an effort to stop that now.
Bankruptcy is a challenging time and can create a huge amount of mental and emotional stress. To have a reliable and trustworthy guide through the process, find a highly qualified attorney. Do not let price be the only factor. It is not necessary to engage the lawyer who charges the highest fees; all you need is a lawyer of high quality. Look to the bureau for better business, consultation, as well as others who have formerly experienced bankruptcy for more information about lawyers. If you want to know more about a specific lawyer, attend a court proceeding and see how the attorney handles herself.
Do not take a large cash advance from credit cards prior to filing, knowing that bankruptcy erases all debts. Doing so constitutes fraud. You can easily be ordered to repay all of this money, by the courts.
Be mindful of paying off outstanding obligations before you file a bankruptcy petition. Check the bankruptcy laws in your state to make sure you have not done anything in the past year to make yourself ineligible to petition for bankruptcy. Do your research and figure out the laws for you.
Lots of individuals who previously filed bankruptcy vow to shun the use of credit cards or lines of credit in the future. This is actually a poor idea because credit helps to build good credit. You will not be able to get your credit back to a respectable score if you don’t use credit. Begin with a credit card that has the very low limit and handle it extremely responsibly to begin healing your credit rating.
Remember that bankruptcy isn’t the end of the world. Just look at Donald Trump. He has filed multiple times! Get on track and stay there to show lenders your positive new efforts. Build up your savings and see what kind of deal you can get when you apply for a car loan or a mortgage.
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