Filing for personal bankruptcy protection is an important strategy for people that have had assets, such as their vehicle, seized by the IRS. There are times when bankruptcy is the last option left, even if it substantially damages your credit score. Continue reading for more information about how and why to file for bankruptcy.
Do not use your retirement fund or savings to pay off creditors. Retirement accounts should never be accessed unless all other options have been exhausted. Though you may have to break into your savings, keep some available for difficult times. You will be glad you did.
Do not hesitate to remind your lawyer of any details regarding your case. You should not take for granted that your lawyer will remember every important detail that you have have told him earlier without a reminder. 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.
If you know people who have filed for bankruptcy, ask them who they would recommend rather than relying on Internet reviews or worse, just randomly picking someone out of the phone book. Companies are constantly popping up, claiming to help, yet only seek to profit from your misery. In ensuring that your bankruptcy is as simple as possible, trusting your attorney makes a big difference.
Bankruptcy Laws
Learn the newest bankruptcy laws before filing. Make sure to get the most up-to-date information concerning the bankruptcy laws in your state. All of these changes will be addressed on the state’s legislative site. You can also contact them directly by phone or office visit.
Most bankruptcy lawyers offer a free consultation, so meet with several before you decide on one. Be certain you talk to the lawyer, himself, instead of a paralegal or assistant; those people aren’t allowed to give legal advice. Interviewing multiple attorneys is a good way to find the best fit.
Take some time after filing for bankruptcy to enjoy life. It is common for people to stress when filing. Make sure you take care of your part and let your attorney do the rest. Life will get better after you finally get this situation over with.
Carefully consider filing for bankruptcy on loans that have a co-signer, especially if that co-signer is a business associate, close friend or relative. When filing Chapter 7, you are not legally responsible for the debts in your name. So, in short, if you file bankruptcy, but they do not, they will be held completely responsible for your joint actions.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. You should not transfer your assets to anyone in the year preceding your bankruptcy filing. Also, you can’t go and max out your credit card just because you are about to file for bankruptcy.
Credit Score
Many people who have filed for bankruptcy, resolve to never use credit or credit cards again. Since using credit responsibly is the only way to improve your credit score, this is not such a good idea. If you aren’t using any credit, then it will be very difficult to get your credit score high enough to be able to purchase things like a car or home in the future. The best way to help build your credit is to get one credit card and pay it off at the end of every billing cycle.
Before you file, make the choice to be fiscally reliable. The period before your filing is not the time to run up additional debts. Judges and bankruptcy trustees take your repayment history into account when deciding the terms of your bankruptcy. Your most recent behavior should show that you realize the error of your ways and have changed course to become more fiscally responsible.
Contrary to popular belief, you won’t necessarily lose your assets if you happen to file for bankruptcy. Your personal items will stay with you. In other words, your clothes, your television, your computer, your furniture, your jewelry and other household items are safe. Depending on where you live and what you’re filing for, you might be able to keep you home and things like you car.
Select a bankruptcy attorney wisely. You do not want to hire someone who is new to the field of bankruptcy. Be certain your attorney has enough expertise and has a valid license. Use the Internet to look at lawyer’s disciplinary records, background, and client ratings.
As you can see by now, you do have the option of filing bankruptcy. That said, you should think twice before filing, since it leaves a huge black mark on your credit. Knowing the ins and outs of the bankruptcy process will save you from stress that will arise if you miss something down the line.
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