Bankruptcy will always be a stressful event in a person’s life. Unfortunately, people experiencing bankruptcy often find themselves spending a large amount of their time worrying about day-to-day issues and expenses. As you can see, filing for bankruptcy does not mean life is over.
Never shirk on the truth in your petition for bankruptcy. You may be tempted to try to hide income and personal assets from discovery, but doing so often leads to major complications, monetary penalties and the possibility that your case will be thrown out of court.
Do some research to find out which assets you could lose by filing for personal bankruptcy. The kinds of assets which may be exempted during bankruptcy proceedings are listed in the Bankruptcy Code. It is vital that you completely understand which assets are protected and which assets can be seized prior to filing bankruptcy. This will ensure that you do not have any surprises once you have filed bankruptcy.
You are going to get found out and get in trouble if you don’t disclose all your assets, so be totally honest from the beginning. Regardless of the agency you file with, ensure that you tell them all they should know about your current financial situation, regardless of how good or bad it is. Don’t hold back information and create a strategy so you can deal with what’s really happening.
Avoid paying for a consultation with the bankruptcy attorney, but do ask many questions. Most lawyers offer free consultations, so consult with a few before settling on one. Only choose a lawyer if you feel like your questions were answered. You don’t need to decide what to do right away. After your consultations, do some additional research on each attorney you consider qualified for the job.
Chapter 7
The two main kinds of bankruptcy are Chapter 7 and Chapter 13. Make sure you understand them so you know what is best for you. In Chapter 7 bankruptcy, your debts are all eliminated. Your former ties with creditors will cease to exist. Filing Chapter 13 differs by requiring you to agree to a 60 month plan to repay your debts before they are totally eliminated. It is important that you understand the differences between the different types of bankruptcy, so that you can decide which option is best for you.
Being with the people who you love should be still be a top priority. Going through a bankruptcy can be an excruciating experience. It is often overwhelming, and not quick. Some people may feel embarrassed or feel their self-esteem has taken a beating from it. Lots of people think they need to hide from everyone until this is all done. This isn’t true though because when you isolate yourself you will just start to feel worse and may become depressed. Because of this, it’s vital you keep spending some time with the people you love despite what you are currently going through.
Reducing Interest Rates
Look at all of your options prior to deciding to file for bankruptcy. A lawyer that specializes in bankruptcy law can help advise you of other options, such as repayment plans and reducing interest rates to relieve some of the burden. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. When all is said and done the creditors just want their money, and more often than not will work with you on a repayment plan.
Do not think of filing for personal bankruptcy as a shameful thing. Often, with bankruptcy, come feelings of guilt, shame and worthlessness. But, there is nothing positive about feeling this way and it can actually affect your mental state. If you are filing for bankruptcy and you are thinking negatively about the situation, make an effort to stop that now.
Typically, people who have faced bankruptcy swear off credit cards. That is not a great idea, because using credit builds better credit. If you don’t use your credit, you won’t be able to make big purchases on credit in the future. Begin with a credit card that has the very low limit and handle it extremely responsibly to begin healing your credit rating.
By now, you should be able to see that personal bankruptcy does not leave you doomed. Although it is hard at first, you will get through it. Follow our tips to work your way past your burden of debt.
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