Most people consider bankruptcy as a choice of losers, but quickly change their mind when it directly affects them. Major life changes, including divorce and job loss can quickly cause a financially stable person to become insolvent, forcing him to file for bankruptcy. Read this article to learn more about bankruptcy and find out if filing is the best option for you.
Lots of people have to claim bankruptcy when their bills are larger than their income. If you’re in this situation, learn about the laws where you live. There are greatly varying laws concerning bankruptcy, so it is important to make sure you are getting the correct information. Some states protect your home, and others do not. It is important to be cognizant of the laws in your state before filing for bankruptcy.
Credit Card
Do not try to get clever by paying your taxes via credit card before you declare bankruptcy in an effort to dodge your tax burden. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. Bear this in mind; if the tax can be discharged, then the debt can be as well. Because of this, transferring the debt to your credit card is pointless.
If you suspect that bankruptcy filing may be a reality, don’t try to discharge all your debt in advance by emptying your retirement or saving accounts. Leave your retirement accounts untouched unless there is absolutely no other alternative. Though you may have to break into your savings, keep some available for difficult times. You will be glad you did.
Always be honest and forthright when it comes to your bankruptcy petition. Don’t hide income or assets from your lawyer or the bankruptcy trustee or you may find yourself in legal trouble.
Prior to filing for bankruptcy, determine which assets, if any, are exempt from being seized. Bankruptcy exemptions are properties may not be seized during bankruptcy. Be sure that you study this list. Make yourself aware of any assets you have that could be seized. You wouldn’t want to unexpectedly lose any possessions you treasure.
When you do meet with a lawyer make sure that they answer all of your questions and that they do not charge you for consultation alone. Almost all lawyers will give a free consultation, so meet with more than one before making a decision on whom to hire. Decide which lawyer you like best buy reviewing all of the lawyers’ answers to your questions. Choose the lawyer who addressed your issues the best. You do not have to give them your decision right after the consultation. So you have sufficient time to speak with a number of lawyers.
Pick the right time to file. Timing is everything, especially in personal bankruptcy filings. There are times when you should file as soon as you can, but in some other situations it may be best to wait for the worst to be over. Discuss your particular situation with your bankruptcy attorney to determine the best time to file.
Be sure you know the bankruptcy laws before you think about filing. For instance, it’s prohibited for an individual to transfer assets to someone else a year before filing for bankruptcy. It’s also prohibted to run up debt on credit cards just prior to filing.
Long before you file any paperwork dealing with bankruptcy, your first step should be learning the rules and the process. The bankruptcy code contains several provisions that can raise serious obstacles in your case. It is even possible to make the sorts of errors that can cause your case to be dismissed. Make sure you are fully aware about personal bankruptcy before you make any final decisions. If you take care of this now, you can avoid problems going forward.
If you’ve already tried everything you can think of to dig out of your financial mess, it might be time for bankruptcy. If changing circumstances have caused you to be in this position, you shouldn’t stress yourself out. You will see treasured information in the article that follows.
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