Some people think bankruptcy is an option for “losers”; those are usually the first people that think differently when bankruptcy affects them. Illness, extended unemployment and other financial hardships can result in a devastating financial situation. If this has happened to you, the hints in this article may be of use.
Learn as much as you can about bankruptcy by going to informational websites. The United States Check out the Bankruptcy Institute site and do some research about consumer’s rights. By having more knowledge, you can make the right decision, as well as be sure you are ensuring that your personal bankruptcy case goes smoothly.
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. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy. One thing that you should remember is that if your tax is dischargable, your debt will also be dischargeable. Thus, it doesn’t make sense to use a credit card when it is going to be discharged when you file for bankruptcy.
If you are feeling like you are seriously going to have to file for bankruptcy then do not clear out your savings. Leave your retirement accounts untouched unless there is absolutely no other alternative. You may need to tap your savings, but don’t empty your savings account, as this could leave you in a difficult situation down the road.
Do not attempt to conceal any assets when filing for bankruptcy because you may be penalized when they are discovered. Penalties may include fines, imprisonment or denial of the filing. Lay everything out on the table so that you and your lawyer can devise a plan to get you out of this mess.
There is hope! There may still be way to get repossessed items back after you file for bankruptcy. If you have any property in repossession that was taken less than three months before filing for bankruptcy, then there are good odds that you can get your property back. Consult with a lawyer who can help you along with filing the petition.
Find a bankruptcy attorney who offers free consultations, and ask lots of questions. Most attorneys offer a free consultation which you should take advantage of. Meet with a few before finalizing your plans. Therefore consult with different lawyers and get a feel for them, then decide which one suits your needs You do not need to make a decision immediately after the consult. Take the time to meet with a number of attorneys.
Before declaring bankruptcy, be sure you’ve weighed other options. For example, there are credit counseling services that can help you to deal with smaller amounts of debt. You should also try negotiating a payment plan with your creditors; make sure you get a written agreement of the new payment plans.
Chapter 7
You need to educate yourself on the differences between Chapter 7 and Chapter 13. Chapter 7 eliminates all debts. All the things that tie you to creditors will go away. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. Both options have advantages and drawbacks, so do your research before deciding.
Safeguard your home. Filing for bankruptcy will not always result in losing your home. It depends what your home value is and if there is a second mortgage, as all this stuff comes into play when determining if you can keep the home. You are still going to want to check into homestead exemption either way just in case.
Look at bankruptcy as a chance to mature and take responsibility for your personal finances. Bankruptcy can sometimes leave people feeling guilty, ashamed and alone. Do not let these negative feelings influence your decision. The best way of dealing with bankruptcy is to keep a positive attitude during this time of financial upset.
Gain an understanding of bankruptcy law before you file. You want to understand what is going to happen when you file for your specific case. Small errors could even cause your case to be dismissed. Before continuing, research personal bankruptcy. This will ensure your bankruptcy will go smoothly.
Look into other options before deciding to file for bankruptcy. Credit counseling may work for you. Many different non-profit entities exist that can assist you without charging you any fees. Their job is to lower your payments and interest through negotiations with your creditors. You pay them and then they pay the creditors.
Several of those who’ve already filed for bankruptcy vow that they won’t have a credit card ever again. This is not a good decision on their part because credit cards help in building good credit. In the future, you will almost certainly need credit to make major purchases, such as a house or a car, and your credit score will be dreadful if you haven’t used credit since your bankruptcy. Keep it simple with one card and take a slow approach to rebuilding.
Remember that just because you have filed for personal bankruptcy it will not cause you to lose everything you own. When you file for bankruptcy, you are allowed to keep personal property. This covers items such as clothing, jewelry, electronics and household furnishings. Exactly what assets you can hang onto will depend on the applicable laws in your state, your filing status, and your personal finances.
If you have attempted every single option for dealing with your finances and you still come up dry, then you may have to file for bankruptcy. Don’t stress if your situation has made you decide to take this route. Important information can be ascertained simply by reading on.
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