If your car or other valuable items are about to be repossessed due to back taxes, you are probably quite afraid of what will happen. If you want to put an end to the annoying calls, the threatening letters, and other intimidation tactics, filing bankruptcy may be your only out. Find out what you need to know before filing bankruptcy.
People generally mostly feel the need to get a bankruptcy filed for when they have more money owed than they can get. If this sounds familiar, you should read up on the bankruptcy laws in your state. The laws governing bankruptcy vary from state to state. Some states protect your home, and others do not. It is important to understand the laws in your state before filing for bankruptcy.
Always be honest and forthright when it comes to your bankruptcy petition. To avoid problems, penalties and future re-filing bans, resist the urge to hide documentation or assets.
Before you decide to file bankruptcy proceedings, determine which assets will be safe. The federal statutes covering bankruptcy can tell you exactly which assets are exempt from forfeiture to pay off creditors. Make sure that you carefully look over this list prior to filing to discover if your valuable assets will be seized. If you neglect this important step, you might be blindsided when a possession that is important to you is taken to repay creditors.
Filing Bankruptcy
It is important to understand your rights when filing bankruptcy. If you file for bankruptcy, you might be able to reclaim certain property that has been repossessed, such as your car, electronics or jewelry. Any property repossessed within 90 days before filing bankruptcy, may be able to be returned to you. Speak with a lawyer that will provide you with guidance for the entire thing.
Weigh all of your options before declaring bankruptcy. For example, consumer credit counseling programs can help if your debt isn’t too large. Some creditors will work with you to help you pay off your debt with lower interest rates, lower late fees, or an extended loan period.
Before picking a bankruptcy lawyer, speak with more than one, since most offer a consultation for free. Ensure that your meeting is actually with the attorney, not with a paralegal or an assistant. People in these positions are unable to offer legal advice. Seeking out different attorneys is all part of the process until you find someone that you can trust.
Before filing a bankruptcy claim, make sure that your home is well protected. Bankruptcy filings do not necessarily mean that you have to lose your house. Check your home’s current value to see if it has gained equity and get your first and second mortgage papers together. There are other options such as a homestead exemption which offers you a chance to remain in your home, depending on whether or not you meed certain financial conditions.
Filing bankruptcy under Chapter 13 means you can still get a loan for a car or a mortgage. There will, however, be obstacles. You must meet with a trustee to gain approval for a new loan. Draft a personal budget to show that you will be able to repay your new loan. Be ready to justify the purchase that you need the loan for, too.
Make sure the time is right when you file a bankruptcy claim. Timing is everything, especially in personal bankruptcy filings. Sometimes you may want to wait to file and in other situations you may find it better to do it as soon as you can. Speak with bankruptcy attorneys for a time frame for filing with your situation.
Do not think of filing for personal bankruptcy as a shameful thing. Often, with bankruptcy, come feelings of guilt, shame and worthlessness. Wallowing in these emotions benefits no one, and only serve to harm your own mental health. To best deal with filing for bankruptcy, look for the positives in the situation.
Filing for bankruptcy can cause stress. If you want to protect yourself from stress, see to it that you hire a good attorney. Do not let price be the only factor. The cheapest attorney may not be the best, but the most expensive may not be the best either. Look to the bureau for better business, consultation, as well as others who have formerly experienced bankruptcy for more information about lawyers. You might be able to view a court hearing. You might be able to watch how your prospective attorney handles the case.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. For example, it is forbidden for an individual to transfer any assets away from the name of the filer within the twelve months preceding filing. It’s also prohibted to run up debt on credit cards just prior to filing.
Don’t put off handling the research or procedures for the bankruptcy process if that is the route you’re taking. It’s hard to admit you need assistance, but the longer you decide to wait, the worse the debt can get. Going to a lawyer as soon as you can is the best to remain in control of your situation.
You should keep in mind that in the long run, bankruptcy can have a more positive impact on your credit score than continually missing payments towards your debt. While bankruptcy may appear in your credit report, you could surely try to fix your damaged credit. This is why people call bankruptcy a fresh start.
Although bankruptcy is an available option, it is best you look for alternative solutions first. Keep in mind that services that promise debt consolidation are usually scams that make your financial problems worse. Take what you’ve just learned to heart, and make wise financial decisions going forward.
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