The decision to file for personal bankruptcy must not be taken for granted. There are many factors involved in the bankruptcy process and it is crucial that you understand them. Allow the suggestions found within this article to lead you down the right path. Whatever difficult choices you must make, it can be made easier with research.
It is important to list all your assets and liabilities during the bankruptcy proceeding. Failure to do so will only cause you problems in the end. It is important that you are completely transparent, showing everything financial that needs to be known. Don’t hold back information and create a strategy so you can deal with what’s really happening.
Stay up to date with any new bankruptcy filing laws. Make sure to get the most up-to-date information concerning the bankruptcy laws in your state. A qualified bankruptcy attorney is the best source for the latest information regarding the laws in your state.
Before making the decision to file for bankruptcy, be sure you have considered alternative options. For example, if your debt is small, try a type of consumer counseling program. 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.
Chapter 13
Do some research to find out more about Chapter 13 and Chapter 7. If you file using Chapter 7 bankruptcy, you will get all your debts eliminated. You will be removed from any contracts you have with your creditors. But, with Chapter 13, you will be in repayment plan for about 5 years prior to any debts you have being totally dissolved. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
Take steps to ensure your home is protected. Bankruptcy filings don’t necessarily have to end in the loss of your home. It may be possible to keep your home if the value has depreciated, or there is a second mortgage. Otherwise, look into the homestead exemption which may allow you to stay in your home if you meet financial threshold requirements.
Include your entire financial information when you file for bankruptcy. If you forget information you run the risk of having your petition delayed, or possibly even dismissed. Even if it’s a small sum, make sure it is listed. Anything, like a job on the side, assets, like cars, and any outstanding loans should be included.
You should keep in mind that in the long run, bankruptcy can have a more positive impact on your credit score than continually missing payments towards your debt. Bankruptcies can remain on your credit reports for 10 years, you can jump right into repairing your credit. The main benefit to filing for bankruptcy is the chance at a new start.
Before you file make sure that you are not doing anything to bring yourself in debt any more. Avoid running up current debts or taking on new debt just before filing for bankruptcy. Creditors and judges will consider both past and current history when deciding on your personal bankruptcy. Try demonstrating that your current behavior and financial habits have positively changed.
Filing for bankruptcy doesn’t mean you will lose all your assets. You may be able to keep certain property. You may keep personal items like jewelry, household furnishings, clothes and electronics. Your current state’s laws, deciding between Chapter 7 or 13, and your current financial position will determine just how much you get to keep.
Organize your debts into an easy-to-read list. This will be included in your bankruptcy filing, so include every entity that you know you owe money to. Obviously, you’re going to want to leave no stone unturned. Rummage through your files and records and receipts to come up with precise numbers. This process should not be rushed; the numbers should be exact.
Take the time to choose a good bankruptcy lawyer. There are a disproportionate number of inexperienced lawyers working in the bankruptcy field. Check your lawyer’s credentials! Be sure he or she is experienced and has the correct licensing. The Internet can be helpful in investigating an attorney’s disciplinary record, client ratings, and background.
As you’ve read, you can file bankruptcy several ways. Do not get overwhelmed by the plethora of information available to you. Take some time to figure things out. The more level-headed you can remain throughout this process, the better the choice will be that you make.
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