The decision to file for personal bankruptcy must not be taken for granted. Before you file for personal bankruptcy, be sure that you understand all of the ramifications. Make sure to use what you learned from this article to make the right decisions. Deciding whether or not to file for bankruptcy is a big decision. Proper and thorough research can alleviate some of that pressure.
Ask yourself if filing for bankruptcy is truly your best option. Consider any other options that are available to you, such as consumer credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.
Unsecured Credit
Be aware that getting unsecured credit is going to be tough once you’ve gone through bankruptcy. If this happens, instead you should turn your attention to secured credit cards. This will prove that you want to improve your credit score. Then, in time, it may be possible for you to obtain an unsecured credit card.
Never pay to have a consultation with a lawyer, and ask a lot of questions. Since most attorneys offer free consultations, meet with a few attorneys before deciding who to hire. Only choose a lawyer if you feel like your questions were answered. You do not have to give them your decision right after the consultation. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.
Be sure to weigh all of your options before deciding to file for personal bankruptcy. For example, if your debt is small, try a type of consumer counseling program. You may have the ability to negotiate much lower payments, just be sure any debt modifications you agree to are written and that you have a copy.
Take advantage of the opportunity to consult with a number of bankruptcy lawyers who offer the first visit at no charge. Ensure that you have a meeting with a real lawyer instead of an assistant, since they can provide the best advice. Be sure to check out a number of lawyers so that you will find one who is just right for you.
Understand the differences between a Chapter 7 bankruptcy and a Chapter 13 bankruptcy. Get a good grasp of the pluses and minuses each type of filing involves by researching both of them extensively. Do not hesitate to have your lawyer explain any details that seem difficult to grasp. This will help ensure you make the right choice when filing.
Investigate your other alternatives before you decide you have to go with bankruptcy. Perhaps consolidating your existing debt can make it easier to manage. A bankruptcy filing takes a great deal of time, and it can be extremely stressful. Your future credit will be affected by these actions. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.
Chapter 13
Consider Chapter 13 bankruptcy for your filing. If you owe an amount under $250,000 and have a consistent income source, Chapter 13 may be right for you. 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. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. Just know that missing one payment could cause your case to be dismissed.
If you are moving forward with a Chapter 7 bankruptcy, you need to learn how that can negatively affect anyone who shares loans with you. Once you have filed Chapter 7, you, by law, are not responsible for any of your debts that also include your co-debtor. Creditors, however, will hold the co-signer liable for the entire balance of the debt.
Before you file, make sure you understand the laws as much as possible. Did you know that in some areas, you cannot transfer assets from yourself to another person in the year previous to filing occurring? It’s also prohibted to run up debt on credit cards just prior to filing.
If you’re continuously making delinquent payments and are constantly missing payments, filing for bankruptcy might just be a kinder, gentler solution for you. The good news here is that, even though the bankruptcy claim will leave a decade-long stain on your credit score, you can still work to repair your credit. Among the advantages of bankruptcy is that of a clean slate.
If you find it necessary to file bankruptcy, hire a bankruptcy attorney. A reputable lawyer can explain the bankruptcy process and be your representative in court on your behalf. Attorneys can prepare your documents and help you with any concerns you may have.
If you are about to get divorced and you are having financial hardships, you may want to rethink your divorce. It is not uncommon for individuals to seek a divorce only to immediately file for bankruptcy due to unforeseen financial difficulty. It is always wise to think twice about divorcing.
Some lawyers offer a free phone line so creditors may be referred there when they make attempts to contact you about your delinquent accounts. If you receive a call from a debt collector, simply provide them with this phone number and any relevant information to prove that your bankruptcy has cleared your debt. Just be sure that they are a legitimate business to safe guard your personal information. This will put an end to annoying phone calls from collectors.
Credit Card
Filing for bankruptcy will probably not help you in the event of exorbitant taxes. Some filers pay the taxes that they owe with credit cards and then they file for bankruptcy. They do this thinking they can skip paying taxes somehow because they left the balance on their credit card. The laws governing bankruptcy forbid this practice and you will be left with both your tax and credit card debt.
As you have seen, filing for personal bankruptcy can be complicated. Don’t suffer from information overload! Think carefully about your situation and the tips at hand. You can make more thoughtful decisions this way.
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