Filing for personal bankruptcy is quite a complicated process. There are multiple ways you can file for bankruptcy, and the one that best fits you will depend on your financial situation and what you owe. Research into what will best suit you is important before you consider filing. The tips included in this article should give you some direction as you go through the process of deciding to file and filing for personal bankruptcy.
Avoid exhausting your savings or emptying your retirement accounts to pay off creditors if you are considering filing for bankruptcy. Avoid ever touching retirement funds until you have no other choice. You may have withdraw from your savings every now and then, but try to leave yourself some financial security for the future.
Never lie about anything in your bankruptcy petition. To avoid problems, penalties and future re-filing bans, resist the urge to hide documentation or assets.
Determine which of assets are safe from seizure and which are not before filing for personal bankruptcy. There are several assets which are exempt from bankruptcy; therefore, consult the Bankruptcy code. It is vital that you completely understand which assets are protected and which assets can be seized prior to filing bankruptcy. Failure to do this could cause some ugly surprises down the road when you discover that your valuables must be seized.
Brush up on the latest bankruptcy regulations before you decide whether or not to file. This area of law is in constant flux and it is imperative that you know where the law stands at the time you file for your bankruptcy. To learn how the law has changed recently, go online and check your state’s website, or call the state government and ask them.
Be sure to weigh all of your options before deciding to file for personal bankruptcy. For example, if you only have a little bit of debt, you might be better off if you went through consumer credit counseling. You may have luck negotiating lower payments by dealing directly with creditors, but be sure to document any get and new agreement terms in writing from each creditor.
Chapter 13
Consider filing a Chapter 13 bankruptcy. You are eligible for filing bankruptcy under Chapter 13 if you work and owe less than $250,000. Filing a Chapter 13 will let you keep personal items and real estate while you pay down your debt in a consolidation plan. These kinds of plans usually range across 3, 4 and 5 years. Once this is done, all your unsecured debt will get discharged. However, if you miss even one payment, the court will dismiss your entire case.
Make sure that you act at the appropriate time. Timing can be critical when it comes to personal bankruptcy cases. In some cases, it is better to file immediately, while other situations benefit from trying to get certain finances in better shape before filing. Discuss your specific situation with a bankruptcy lawyer to find out when would be your best time to file.
If you are going to file for bankruptcy make sure you are prompt. The judge reviewing your petition will consider your recent behavior, purchases, income and payments when making a decision. Your debt can quickly get way too large, and as a result, you may discover that you must foreclose your home or garnish some of your wages. As soon as you’ve decided that you no longer have a handle on your debts, consult a bankruptcy lawyer to see if bankruptcy is right for you.
It is important to be upfront with all your financial information when filing for bankruptcy. Forgetting to add these may cause your petition to be delayed, or even dismissed. Make sure that you add very small sums, even if you believe that they aren’t important. This might take the form of odd jobs, extra cars and outstanding personal loans.
Do not drag your feet when trying to figure out if bankruptcy is right for you. Although it may be very difficult to admit that bankruptcy is the answer for you, it will be much harder to continue spiraling into a debt quagmire. When you speak with a professional quickly, you will get valuable advice that will help to prevent your situation from spinning out of control.
You likely now understand that bankruptcy is something that should be undertaken carefully and with great deliberation. If it seems to make sense in light of your financial problems, you should seek an experienced bankruptcy attorney who can guide you toward a fresh, clean start!
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