It isn’t always easy to file for personal bankruptcy. Bankruptcies come in different types; what you choose is subject to your financial situation and the kind of debts that you have. Before deciding to file for personal bankruptcy, you should learn everything you can about it. This information may point you in the right direction.
Do not use a credit card to manage your tax issues and then try to file bankruptcy. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy. Transferring the debt to another medium (e.g. a credit card) won’t magically make a tax debt discharagable, either. Because of this, transferring the debt to your credit card is pointless.
Always be honest and forthright when it comes to your bankruptcy petition. Not only is hiding income and assets wrong, it is also a crime.
If possible obtain a personal recommendation for a bankruptcy lawyer instead of randomly choosing one. To handle your bankruptcy, you need a trusted attorney, not a shady one that is out to take your money.
Make time to visit with family and friends during the bankruptcy process. Filing for bankruptcy, and all that comes with it, can be hard to handle at times. It can take a long time, take a great emotional toll and cause people to feel embarrassed and defeated. Most people adopt a very negative attitude toward bankruptcy. However, becoming a hermit will only increase feelings of self-doubt and could make you depressed. Therefore, it is important that you continue to spend quality time with your loved ones despite, in spite of your current financial situation.
There are many ways to resolve financial difficulties other than bankruptcy, and you should investigate all of them first. You can get your interest rates reduced or enter into a debt repayment plan. Before you file bankruptcy, ask your attorney if any of these are viable alternatives for you. If a foreclosure is on your horizon, look into loan modification plans. These plans allow you a longer pay off period by extending the term of the loan, reducing the rate of interest or forgiving late fees. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Even if you are involved with Chapter 13 bankruptcy, it is still possible to get a mortgage or an automobile loan. However, it won’t be as easy as it may have been to get one prior to the bankruptcy. You will be required to meet a trustee and be approved for a new loan. Document your budget to prove that you’re going to be able to make the payments. Also, you need to be ready to say why you’re going to need the item.
Take action when the time is right. When you time things right, it does you good, especially when you’re filing for personal bankruptcy. There are occasions where it pays to delay and others where a quick decision is the best option. Speak with a lawyer specializing in bankruptcy in order to learn when you should file your petition.
Before filing for bankruptcy, establish the fact firmly in your mind that you have nothing to be ashamed of. The bankruptcy process can make many people feel ashamed, guilty and unworthy. Do not let these negative feelings influence your decision. The best way of dealing with bankruptcy is to keep a positive attitude during this time of financial upset.
Facing bankruptcy is a negative situation that can bring on stress. Be certain that you hire a competent lawyer to minimize the stress and anxiety you are under. Look beyond the fees a lawyer charges when you make your hiring decision. Choosing a lawyer should be based on finding one with a proven track record who can give you the help that you need. Speak with trusted people, check the BBB and take advantage of the free bankruptcy attorney consultations. If you want to know more about a specific lawyer, attend a court proceeding and see how the attorney handles herself.
Don’t take large cash advances from credit cards prior to filing since the debts will be eliminated from these cards. To do this would be considered fraud. Even after filing for bankruptcy, you might be forced to repay money gained in this manner.
After filing for bankruptcy, many individuals vow they will avoid the use of credit cards and all forms of credit. This is actually a poor idea because credit helps to build good credit. If you don’t ever use credit, your credit history will not improve, and you may not be able to purchase important things like a home and car. Start with one single credit card, and rebuild your credit once more.
Contrary to popular belief, you won’t necessarily lose your assets if you happen to file for bankruptcy. Personal belongings that fall under private property are something that you can keep. Items like clothes, electronics, household furnishings, and jewelry are included in that category. The laws of your state, the kind of bankruptcy you go for, and your finances will determine whether you will lose large assets like your car or your home.
You likely now understand that bankruptcy is something that should be undertaken carefully and with great deliberation. If you think it is the right choice for you, find a lawyer that can properly guide you through the process and give you a new leash on life.
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