Deciding to file for personal bankruptcy is a major life decision, and should not be jumped into lightly. Go over the advice in the following paragraphs to get an idea of what you’re in for, and to learn what you should know before you decide whether or not to file. Doing as much research as possible is important.
Individuals often seek to file for personal bankruptcy protection if their debts exceed their ability to repay them. If you’re in this situation, learn about the laws where you live. The laws governing bankruptcy vary from state to state. Your home is safe in some states, but in others it’s not. Be sure you educate yourself on local laws prior to filing.
The most important tip a person filing for personal bankruptcy can remember and follow is to be completely transparent in all dealings. As long as you are not hiding income or assets from the courts, you can ensure that there are no difficulties with your petition. This will save you from having your petition dismissed and your debts dropped from re-filing.
Don’t hesitate to give your attorney a heads-up about something she has missed. It is wrong to assume that your lawyer will remember every word you ever utter! Remember that you’re the boss. You’re paying your lawyer, so you should not be afraid to have your say. After all, the quality of your life hangs in the balance.
Find out what you exemptions are prior to filing bankruptcy. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. Make sure to review the list before filing a claim so you know if your valuables will be subject to seizure. If you are not aware of the rules, you could be setting yourself up for a lot of stress when your most important possessions are taken in the bankruptcy.
Spend time with loved ones. Bankruptcy can really wear down your emotional reserves. It’s generally stressful, lengthy and can make people feel guilty, ashamed, and unworthy. A lot of folks decide to hide themselves from the world around them until the end of the process. However, this isolation will just make you feel worse, and it could cause you to be depressed. Spend time with your family, talk about your problems and find things that relax you.
Before you file, make sure you understand the laws as much as possible. There are many pitfalls you can easily fall into, such as transferring away assets to prevent them from being included in the filing. Also, you must never incur significant new obligations must prior to filing for bankruptcy.
Consider your options before deciding to file personal bankruptcy. Think about seeing a credit counselor. There are even non-profit companies that may be able to help you. They will negotiate with your creditors in order to reduce your payments and interest rates. You will pay them, and in turn, they will pay the people you owe money to.
Avoid large cash advances from credit cards when considering bankruptcy. You may think these debts will just be washed clean, but you are wrong. Not only is this fraud, but you could still be liable to repay the money at the end of the day.
Before you file for personal bankruptcy, take great care in paying off your debts. Bankruptcy laws generally prohibit certain creditors from being paid back 90 days before filing and family can be around a year! Make sure you have a complete understanding of what is occurring prior to making any final decisions.
Before you file for personal bankruptcy, become more fiscally responsible. Avoid running up current debts or taking on new debt just before filing for bankruptcy. Bankruptcy judges and creditors may examine current and past behavior as they work to resolve your case. Your most recent behavior should show that you realize the error of your ways and have changed course to become more fiscally responsible.
You do not lose everything that you own when you decide to declare bankruptcy. You can often keep personal property. This includes some jewelry, clothing, household furnishing, electronics and more. This will depend on your state’s laws, the type of bankruptcy you file for, and your financial situation, but you may be able to retain large assets like your home and car.
All your debts must be listed on your bankruptcy petition, regardless of whether or not you want them to be. If you fail to list a debt, it may not make it into your discharge. It’s imperative that you record each and every debt, so that nothing gets missed in the petition.
No matter what’s going on, make sure you tell the truth about your situation. In fact, lying about what debts and assets you posses is one of the most serious mistakes you can make. There is no legal way to get around it. If you lie in the recording of your debts and assets, you may end up in prison for quite some time.
Filing for a different type of bankruptcy is a good idea if you think you will lose your home. Try Chapter 13 instead of Chapter 7. It might even be better to convert from a Chapter 7 to a Chapter 13; talk to your lawyer about this.
Make sure all your debts are included in the discharge so you can avoid filing unnecessarily. Certain classes of debt, including taxes, child support, and student loans, are not eligible for bankruptcy. This kind of debt is best tackled through a loan consolidation company or an agency that specializes in credit repair.
This article has probably helped you see that bankruptcy is a process that involves a lot of planning. Many steps have to be taken, and all of them must be performed properly. If you apply the tips above, it is possible to be certain that your case is handled cleanly and thoroughly.
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