A bankruptcy filing is never welcome. The need to file for bankruptcy is usually the result of misfortune. The process can be embarrassing and can cause a person to feel secretive when it comes to finance. Don’t let bankruptcy overwhelm you; the article below can help.
Do not consider paying off tax debt with credit cards and filing for bankruptcy afterward. It won’t work. Most of the time, you cannot discharge this debt. As a result, you will owe the IRS a lot of money. Keep in mind that if the tax debt is eligible to be discharged, then the credit card debt is also dischargeable. If you live in an area where tax can be discharged through bankruptcy, financing your tax bill is pretty pointless.
Always be honest and forthright when it comes to your bankruptcy petition. Not hiding any assets or income is essential for avoiding possible penalties and your ability to re-file at some point in the future.
Be completely honest whenever you file for personal bankruptcy. Hiding any asset or liability is a risk that will bite you in the end. Whomever you use to file with must know everything there is to know about your finances, both good and bad. Don’t hold anything back and formulate a smart strategy to deal with the reality you are facing.
Bankruptcy Laws
Before you file, make sure you understand current bankruptcy laws. Laws are ever-evolving. You must stay current with bankruptcy laws if you want to be successful in your challenge. Your state’s legislative offices or website will have up-to-date information about these changes.
Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.
Consider Chapter 13 bankruptcy, if you chose to file. If you currently have some income and don’t have more than $250k in debt, you can declare bankruptcy. Filing for this type of debt will ensure that you can hold onto your real estate and personal property, and will let you develop a consolidation plan to pay off your debts. Expect to make payments for up to 5 years before your unsecured debts are discharged. Missing a payment under these plans can result in total dismissal by the courts.
If you are making more money than you owe, bankruptcy should not even be an option. Understand that while declaring bankruptcy will eliminate many of your debts, you will have difficulty obtaining credit and will pay more in interest for the credit you do receive for at least seven years.
Look into all of your options before you choose to file for bankruptcy. Talk with a bankruptcy lawyer and ask about alternatives, such as debt consolidation or negotiating with creditors. If you are looking at foreclosure, think about a loan modification program. The lender wants their money, so they may be willing to forgive some fees, change the loan term or reduce interest as ways of assisting you. Because of the fact that creditors would like to see their money they are likely to offer repayment plans versus not getting paid at all if you file for bankruptcy.
Speak with your attorney about ways you can keep your car. Most of the time Chapter 7 bankruptcy will allow your payments to be lowered. Your car must have been purchased more than 910 days prior to filing, be a high interest loan, and you must have had a steady work history for this to work.
Make sure you consider implications of bankruptcy before filing for Chapter 7. When filing Chapter 7, you are not legally responsible for the debts in your name. Sadly, this will not be the case for your co debtor. Your creditors may simply turn their attention to your hapless acquaintance.
Because of the comes from bankruptcy, you may feel overwhelmed and stressed. One way to help reduce is this stress is to hire a reliable attorney. Don’t think that the highest priced attorney is the best. You do need someone who is costly, just someone who is good at what they do. Talk to friends who have been through a similar situation and ask them for referrals. If you want to know more about a specific lawyer, attend a court proceeding and see how the attorney handles herself.
Every single piece of financial information you have needs to be studied and properly listed when filing a bankruptcy claim. Forgetting anything can cause a delay, or even a dismissal. Even small amounts of money contribute to your overall financial picture, so do not exclude them. This can include side jobs, any vehicles to be counted as assets, and any loans you may currently have.
Before you file bankruptcy, consider how you will pay off your debts. The laws surrounding bankruptcy often prohibit paying back certain creditors up to ninety days prior to filing, and family members up to a year! Study applicable regulations prior to making any financial choices.
You do not always need to give in and file bankruptcy. The guidance from this piece can serve as a road map for steering clear of bankruptcy. Use the information in this article to change your financial future and never have to worry about credit again.
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