Bankruptcy is a complex process. There is more than one type of personal bankruptcy, and your personal financial situation will dictate which type you should choose. Prior to filing, there is a lot you need to know. The following article contains valuable information to help you make that decision.
Individuals often seek to file for personal bankruptcy protection if their debts exceed their ability to repay them. When you are faced with this issue, begin to familiarize yourself with your state’s laws. Each state has their own bankruptcy laws. For example, whether or not you can keep your home, as well as what you need to do to keep it, is different for every state. You should be familiar with the laws for your state before filing for bankruptcy.
Never shirk on the truth in your petition for bankruptcy. Do not hide any income or assets or go on a spending spree before filing for bankruptcy: the court will find out and will not have a positive opinion of you.
Try to find a bankruptcy attorney who is personally recommended, rather than off the Internet, or out of the yellow pages. You want your bankruptcy to go smoothly, and the Internet is rife with fly-by-night companies whose only goal is to prey upon the financially desperate.
Be aware of recent changes, if any, in the bankruptcy code. Bankruptcy laws are always changing, and you need to be aware of any changes so your bankruptcy can be properly filed. To learn about the changes, you should check out the website of your state’s legislation or you can call their office.
Before pulling the trigger on bankruptcy, be sure that other solutions aren’t more appropriate for your case. There are numerous programs out there that may assist you with your debt, like a credit counseling program, a nonprofit group, government assistance, etc. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
Meet with a few attorneys who offer free consultations before hiring one. Make sure you meet with a licensed attorney rather than a paralegal or assistant, because it is illegal for these people to give legal advice. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
Repayment Plan
Before you file for personal bankruptcy, weigh all of your options. Consult with a bankruptcy attorney to see if an interest rate reduction or debt repayment plan is an alternative to filing for bankruptcy. A plan that can be useful when foreclosure is looming is a loan modification. Some lenders will make concessions rather than losing the money owed to bankruptcy. These concessions include waiving late fees, lowering interest rates, and changing the loan term. When all is said and done, the creditors want their money, so sometimes it’s best to deal with a repayment plan than with a bankruptcy debtor.
Before you decide to file for Chapter 7 bankruptcy, consider how it could affect other people on your credit accounts, such as family members or business partners. Speak to an attorney or read the bankruptcy laws in your state to find out if certain loans can be excluded from your filing. However, if you had a co-debtor, they will be required to pay the debt.
Consider all of your options before filing for bankruptcy. One good option might be credit counseling. There are many non-profit debt counseling services available. These companies work with creditors to reduce your payments and interest. Once you pay them, they make the payments to your creditors.
Prior to filing, do not use your credit card to get a cash advance, knowing your debts will be eliminated. Not only is this fraud, but you could end up having to pay back the money, even once you have filed for bankruptcy.
Now you know that filing for bankruptcy is something to be considered before going through with it. With your finances in turmoil, seek a reputable attorney who has bankruptcy experience. This will allow you to see this as a true, fresh experience.
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