Bankruptcy definitely causes short-term stress, but if you’re responsible, it can be a relief in the long term. It is not fun when you have to bear all your finances out in the open and everyone picks apart your financial situation. This may be very uncomfortable; however, after your bankruptcy case has been completed, you can start anew free from the hassles of bill collectors. Here are some simple tips anyone can use to help make the process of bankruptcy go smooth.
Prior to filing for bankruptcy, discover which assets cannot be seized. The federal statutes covering bankruptcy can tell you exactly which assets are exempt from forfeiture to pay off creditors. You can determine exactly which of your possessions are at risk by consulting this list before you file. If you don’t read it, you could have nasty surprises pop up later due to your prized possessions being seized.
Be aware of recent changes, if any, in the bankruptcy code. Bankruptcy law has changed substantially in recent years, and therefore you must understand how such changes may affect your situation. To stay up-to-date on these laws, check out your state’s government website.
Consider other alternatives before filing for bankruptcy. For example, you want to look into credit counseling. This is the best option for small debts. You may have luck negotiating lower payments by dealing directly with creditors, but be sure to document any get and new agreement terms in writing from each creditor.
Find out about lowering the cost of the payment you pay monthly on your car, if you are afraid of losing it. In many cases, you can reduce your payment by filing a Chapter 7 petition. Your car must have been purchased more than 910 days prior to filing, be a high interest loan, and you must have had a steady work history for this to work.
Chapter 7
Take into consideration all the ramifications of a Chapter 7 bankruptcy. Filing for this can impact any co-debtors, such as friends or family. When you file under Chapter 7, you will no longer be legally responsible for any debts that were signed by yourself and a co-debtor. However, if you had a co-debtor, they will be required to pay the debt.
Don’t overly concern yourself with any negative feelings you are having. You may need to get credit counseling or simply learn how to balance your budget. Wallowing in these emotions benefits no one, and only serve to harm your own mental health. The best way of dealing with bankruptcy is to keep a positive attitude during this time of financial upset.
It is important to file bankruptcy before its too late. Do not avoid your creditors; they will not go away. It is important to decide on a course of action as soon as you begin experiencing financial problems. Your debt can quickly get way too large, and as a result, you may discover that you must foreclose your home or garnish some of your wages. As soon as you find yourself experiencing financial problems, take action and discuss your options with a bankruptcy attorney.
When you are filing for bankruptcy, make sure you list all of the financial information you may have. Neglecting to include the smallest of detail can lead to a petition being dismissed. No sum is too small to be included; err on the side of caution and include everything. This financial information may include income from side jobs, vehicles you own and loans you have not paid off.
Be careful how you pay off any debts prior to filing for personal bankruptcy. Bankruptcy law may actually prevent you from repaying your credits for three months. Worse, if you’ve taken out a loan from your family, you can’t repay them for a whole year before filing. Read up on the rules before you make any decisions about your finances.
Bankruptcy is both a good and a bad thing; it depends on perspective. Regardless of what your reason for declaring bankruptcy is, it is vital that you keep informed and involved in the entire process. These tips can make dealing with bankruptcy easier. Apply all of the knowledge you have gained from this article and you will be on your way to feeling more at ease about your bankruptcy.
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