A bankruptcy filing is never welcome. Many people feel embarrassed or ashamed if they have to tell other people that they are bankrupt. If you decide to file bankruptcy, research the laws in your state and retain the services of a qualified attorney.
Do not use a credit card to pay income taxes and then file for bankruptcy. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. The rule here is that if you can get the tax discharged then you can get the debt discharged. So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
Ensure that you are providing genuine details when filing a bankruptcy petition, because honesty is the best policy when dealing with bankruptcy. Remember that if you hide your valuable assets or income from your bankruptcy trustee, you may risk a number of penalties and complications. Among these is the possibility that you could be blocked from ever filing again.
Don’t hesitate to give your attorney a heads-up about something she has missed. Chances are that you may have forgotten to tell them about certain specifics that may be important to your filing. Ultimately, this is your bankruptcy and your financial future, so never hesitate to advocate on your behalf.
Try to get a bankruptcy lawyer that your friends recommend, as opposed to someone that you find from the Internet or yellow pages. There are lots of unsavory companies and lawyers out there who prey on people who are in desperate straits. It is up to you to find someone that is trustworthy and can make the process go smoothly.
Take advantage of free consultations with lawyers and the ability to sift through and find the right one. Ensure that your meeting is actually with the attorney, not with a paralegal or an assistant. People in these positions are unable to offer legal advice. Be sure to check out a number of lawyers so that you will find one who is just right for you.
Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. If you do not understand what you are reading, talk to your attorney before making that serious decision.
Bankruptcy should not be filed by anyone who makes more than their bills cost. 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.
Consider all options before filing for bankruptcy. For example, you can always talk with a lawyer to see about different options through creditors or other means that will not require wiping the entire slate clean. Look into loan modification plans if you need to deal with an imminent foreclosure. Your lender can adjust your loan in many ways including extending the time you have to pay, reducing your interest rate, or canceling some of your late fees. At the end of the day, creditors want to get paid, and sometimes a debt repayment plan is preferable to dealing with a bankrupt debtor.
Filing Process
Do not forget to enjoy life a little once you get through the initial filing process. It’s not uncommon to be overwhelmed by the filing process. Depression and burn-out from pent of stress will do nothing to help your situation, so it is critical to let go a little. Once your petition is in the hands of the judge, all you can do is wait.
Think about any co-debtors you have prior to filing for Chapter 7 bankruptcy. Once you complete a Chapter 7 bankruptcy, you will be free of any responsibility of debt, which could put all responsibility on someone close to you. However, your creditors will be able demand that your co-debtor pays the debt off in full.
You see, you don’t have to give in to bankruptcy. By using this article you will be well on your way to avoiding bankruptcy. Apply what you’ve learned here to make changes in your life that will not hurt your credit.
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