Facing bankruptcy makes life difficult. You realize how limited you are when it comes to a tight financial situation. Despite a bankruptcy on your record and a dinged credit score, you can often still get loans if you need them.
Don’t use credit cards to pay your taxes if you’re going to file bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. In most cases, you can use the adage that “a dischargeable tax is a dischargeable debt.” So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
Never shirk on the truth in your petition for bankruptcy. It is vital that you disclose all information about your assets and income so there are no delays or penalties, such as a court barring you from filing again later in the future.
After you have declared bankruptcy, you may have a hard time being approved for unsecured credit. Since it is important that you work to rebuild your credit, you should instead think about applying for a secured card. This at least shows you are making an honest attempt at reestablishing your credit worthiness. In time, it may be possible for you to obtain unsecured cards.
Before filling for bankruptcy, determine which assets will be exempted from seizure. The Bankruptcy Code lists assets considered exempt from being affected by bankruptcy. Be sure that you study this list. Make yourself aware of any assets you have that could be seized. This will ensure that you do not have any surprises once you have filed bankruptcy.
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. Most lawyers will meet with you for free and give you helpful advice, so meet with several. Only choose a lawyer if you feel like your questions were answered. It is not necessary to make a final decision right away. That gives you the chance to speak to a number of lawyers.
Filing Process
Remember to have fun with your life when you’re done with the filing process initially. The filing process is extremely stressful for a lot of the people who go through it. Stress easily leads to depression, if you are not maintaining control of your emotions. Life will surely get better after you finish this process.
Before filing for bankruptcy under Chapter 7, make sure that you consider the implications this will have on any of your co-debtor, who are usually family members, close friends or business associates. When you file a Chapter 7, your debts will be dissolved. However, anyone sharing the loan with you may be forced to pay back the entire amount for the amount in full, which spell financial disaster for them.
Act when the time is right. Timing is very important when it comes to personal bankruptcy filings. For some debtors, immediate filing is ideal, whereas in other cases, it is smart to hold off until a later time. Have a chat with a bankruptcy specialist to discover when the ultimate time would be for you to file.
Don’t let shame consume you during the bankruptcy process. You may need to get credit counseling or simply learn how to balance your budget. Learn to accept these feeling at face value– you can’t prevent yourself from feeling them, but you can stop them from controlling you. Remembering to stay positive as you go through financial difficulties is a great way to deal with your bankruptcy filing.
Bankruptcy is a step that many people have to take, and as you can see, it’s not a permanent black mark. If you don’t spend frivolously and repay lenders faithfully, lenders will be more willing to lend to you in the future. Begin saving today, and you’ll surely notice the difference in others’ perception of you when you apply for an important loan such as a home or car loan.
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