Personal bankruptcy can be overwhelming during the process, but a load off your shoulders once you get through it. You will be forced to expose your financial life to outsiders and you will have to sift through all of your assets and obligations. On the other side, you will no longer receive calls from bill collectors and you can work on your finances. Here are some simple tips anyone can use to help make the process of bankruptcy go smooth.
Learn as much as you can about bankruptcy by going to informational websites. The United States Run a quick Internet search to find out all the different agencies you should be contacting or visiting via the web to find out what you can. The more you know about it, the better you are able to make the best decision for your situation and to make sure that the bankruptcy proceedings move forward with minimal setbacks.
When it soaks in that filing for personal bankruptcy, don’t use all of your retirement funds, or all of your savings to resolve insolvency or pay creditors. Retirement accounts should never be touched if it can be helped. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
When filing for bankruptcy it is crucial that you are candid and not concealing any liabilities or assets, as it will only show up in the future. Your attorney and trustee should be privy to all information about your finances. Don’t withhold information, and create a smart way of coping with the reality of the situation.
If you’re going to file bankruptcy, you need an attorney. Personal bankruptcies are detailed and complex processes, and you may miss something that costs you money. A specialized bankruptcy lawyer can ensure that you are handling your bankruptcy filing the right way.
Before declaring bankruptcy, be sure you’ve weighed other options. If you owe small amounts of money, you can join a counseling program or straighten your finances out by yourself. You might also be able to negotiate lower payments yourself, but make sure that you get written records of any debt modifications to which you agree.
Chapter 7
Be certain that you can differentiate between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 eliminates all debts. With very few exceptions, the connections between you and your creditors will be severed. Chapter 13 bankruptcy allows for a five year repayment plan to eliminate all your debts. Both options have advantages and drawbacks, so do your research before deciding.
A free consultation is standard for bankruptcy attorneys, so shop around before settling on one. 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. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
Make sure that you really need to file for bankruptcy. Consider whether debt consolidation may be a more viable alternative. Going through a bankruptcy is a long and stressful process. Your future credit will be affected by these actions. You only want to file for bankruptcy after you have exhausted your other options for dealing with your debts.
If you can afford to pay your bills, bankruptcy is not a wise option. Bankruptcy may appear like the easier way to avoid paying your old bills, but it is a huge mark on your credit score and remains there for up to 10 years.
There are benefits and detriments to filing bankruptcy. Regardless of your reason for filing, be aware information is the closest friend you have during the entire thing. This article should help you learn more about personal bankruptcy. As long as you implement these tips how you read them, you should be able to make much more sense of the process.
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