Bankruptcy is very common in today’s economic climate. The economy can be partially to blame for the rise in bankruptcy. Before you begin to file bankruptcy, it’s imperative that you know how it works so you can make wise decisions. This article can help you with that.
If you are faced with the choice of filing for bankruptcy or using your emergency fund or retirement accounts to pay creditors, opt to file for bankruptcy. Unless there are no other options, your retirement funds should never be touched. You may need to withdraw some funds from your savings account, but don’t take everything that is there as you will be bereft of any financial backup if you do.
Check the accuracy of all information before it is filed. Many times a lawyer may forget a key detail; therefore, it is important to remind your lawyer of any key information. Be as open as you can be to make sure your bankruptcy goes as well as possible.
Credit Cards
After a bankruptcy, you may not be able to receive any credit cards. If you are in this situation, applying for a secured card may be the answer. This will show other people that you’re serious when it comes to having your credit record in order. After a certain time, you will then be able to acquire credit cards that are unsecured.
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 lots of unsavory companies and lawyers out there who prey on people who are in desperate straits. It is up to you to find someone that is trustworthy and can make the process go smoothly.
No matter what, don’t give up! There may still be way to get repossessed items back after you file for bankruptcy. You may be able to recover repossessed property if the repossession occurred fewer than 90 days ago. Interview and research attorneys before choosing one to help you with your bankruptcy.
You should be able to meet with a specialized lawyer for free to ask your questions. Nearly all attorneys offer free initial consultations, so you should be able to meet with a few before you make a final hiring decision. Only make a decision after you have met with several attorneys and all of your concerns and questions have been addressed. You need not decide right away. You can take your time and check out several attorneys before making your final selection.
Chapter 13
Consider Chapter 13 bankruptcy. With a consistent income source and less than $250k in debt, try filing for Chapter 13. Declaring bankruptcy can assist you in consolidating your debt so you can repay it more easily. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. Remember that if you even miss one payment that’s due under this plan, the court could dismiss the whole case.
Do not forget to make quality time for friends and family members. Filing for bankruptcy is a difficult process. It is long, hard and sometimes leaves people feeling guilty or ashamed. Lots of people decide they should hide from everyone else until it is all over. This is not recommended because you will only feel bad and this may cause you to feel depressed. Remember that it is not your families fault for your financial hardships and use this time to pull together and be strong.
There are circumstances where you are able to keep your car during a bankruptcy so be sure to ask your lawyer about possibly reducing the payments. Sometimes, as part of the bankruptcy filing, your auto loan can be restructured so that you pay less each month. But, your car has to have been bought at least 910 days before you file. Also, it must come from a high interest loan and you have to have been consistently working.
As you are no doubt aware, bankruptcy is much talked about in today’s economy. Apply what you’ve learned here today and make wise decisions about bankruptcy going forward.
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