When you decide to file for personal bankruptcy, it is a very serious decision that should not be entered into lightly. Digest the information contained herein, so that you are aware of what you can expect and you know what actions to take prior to making that critical decision. Learn as much as you can beforehand.
Do not pay your taxes with credit cards that will be canceled when you file for bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. If the tax can be discharged, so can the debt. Therefore, you have no reason for use of a credit card, if the amount is to be discharged in due process of the bankruptcy.
Unsecured Credit
After a bankruptcy, you may still see problems getting any kind of unsecured credit. If you find that to be the situation, consider requesting secured cards. This will allow you to start building a good credit history while minimizing the bank’s risk. After some time passes they may be willing to offer you unsecured credit.
Be sure to hire an attorney before you embark upon filing for personal bankruptcy. You may not know everything you need to know in order to have a successful outcome of your case. An attorney that specializes in personal bankruptcy, can help guide you and make sure that your filing happens properly.
Always weigh your options carefully prior to deciding to dive head first into filing a bankruptcy claim. For example, you want to look into credit counseling. This is the best option for small debts. 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 13
Consider filing a Chapter 13 bankruptcy. If you have less than a quarter of a million dollars in debt that is unsecured and a regular income, you are eligible to file a Chapter 13. You can keep personal possessions, as well as real estate, while paying into a debt consolidation system. Generally, this stays in effect for up to 5 years. Afterwards, your unsecured debts clear from your accounts. Keep in mind that even missing one payment can be enough for your whole case to get dismissed.
Filing for bankruptcy is not the best choice if your monthly income is enough to cover your bills. While filing may seem simple and a way to get out of paying your debts, it does tremendous amounts of long-term harm to your credit report.
Rest assured, when you file for Chapter 13 bankruptcy, you still have the ability to take out mortgage and car loans. It is much harder. Your bankruptcy custodian will need to approve the loan. Draw a budget up and show how you can pay the newer loan payment. They may also want to know why you believe you need the loan.
Facing bankruptcy is not a fun situation and cause a lot of stress and anxiety. To have a reliable and trustworthy guide through the process, find a highly qualified attorney. Get recommendations and look into other qualifications rather than just choosing based on cost alone. It may be not be necessary to hire a costly attorney; just make sure he or she is qualified to handle your case. Ask people who have used a bankruptcy lawyer for referrals, look them up at your local Better Business Bureau, then schedule free consultations in order to interview them. Attending a court hearing will give you experience as to how lawyers handle these cases.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. For example, it is against the law to transfer any assets from the filer to another for a year before filing. Also, the filer can not increase their debt before filing.
Do not pay off debts blindly before you file a personal bankruptcy. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and friends and family for up to one year. Study applicable regulations prior to making any financial choices.
As this article has demonstrated, you do not have to go through bankruptcy. When you file for bankruptcy, things must be done the right way. By using the tips in this article, you will be able to successfully file for bankruptcy and begin to rebuild your life.
This is a limited-time offer. We are not able to guarantee availability if you wait!
