Filing for bankruptcy can be a viable for anyone who has had possessions repossessed by the IRS. Bankruptcy can play havoc with your credit, but sometimes it can be the right choice. Read this article to learn more about filing bankruptcy and the consequences of doing so.
A lot of people find themselves needing to file bankruptcy when they are unable to pay their bills. If this is your case, you should do some research about bankruptcy laws in your state. When it comes to bankruptcy, states have varying laws. For instance, in some states, you can’t lose your home to bankruptcy, while in other states, you can. Be aware of bankruptcy laws before filing your claim.
You have other options available like counseling for credit that consumers can use.Bankruptcy leaves a permanent mark on your credit history, you should search through every available option first, you might want to explore all other choices so that your credit history is affected as minimally as possible.
Never lie about anything in your petition for bankruptcy.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy. If the tax has the ability to be eliminated, the debt can be too. This makes using a credit care irrelevant, since bankruptcy will discharge it.
Getting Unsecured Credit
You might experience trouble with getting unsecured credit card or line after emerging from bankruptcy. If you do, instead you should turn your attention to secured credit cards. This will demonstrate that you’re serious when it comes to having your credit record in order. Once creditors see that you are making an effort to restore your credit, you may start getting unsecured credit again.
After a bankruptcy, you may still see problems getting any kind of unsecured credit. If this happens to you, think about applying for a couple of secured credit cards. This will prove that you want to improve your credit score. After a certain time, you will then be able to acquire credit cards that are unsecured.
Filing a bankruptcy petition might facilitate the return of your property, like your car, electronics and jewelry items. You may be able to get your possessions back if the repossession occurred fewer than 90 days before you filed for bankruptcy. Speak with a lawyer that will provide you file the entire thing.
Learn the latest laws before you file bankruptcy. Bankruptcy law evolves constantly, and you need to be aware of any changes so your bankruptcy can be properly filed. Your state’s legislative offices or website will have the information about these changes.
If a personal recommendation comes your way, this should be a lawyer you focus on. Bankruptcy attracts a lot of fly-by-night firms that take advantage of desperate people, and a word-of-mouth recommendation makes it more likely that your bankruptcy will go smoothly.
Before making the decision to file for bankruptcy, be sure you’ve weighed other options. If your debt is relatively low, you can join a counseling program or straighten your finances out by yourself. You may have the ability to negotiate much lower payments, but be sure to document any get and new agreement terms in writing from each creditor.
Understand the differences between a Chapter 7 bankruptcy and Chapter 13 bankruptcy.Take the time to find out about each one online, and then figure out which one will be best for your particular situation. If something doesn’t make sense to you, take the time to go over the specifics with your lawyer before making a decision on which type you will want to file.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. To find an itemized list detailing assets exempt from bankruptcy, find the Bankruptcy Code. Prior to filing for bankruptcy, it is critical that you go over this list, so that you know if you can expect any of your most valuable possessions to be seized. You wouldn’t want to unexpectedly lose any possessions you treasure.
Chapter 13
Consider if Chapter 13 bankruptcy for your filing. If you have less than a quarter of a million dollars in debt that is unsecured and a regular income, a Chapter 13 may be right for you. This plan normally lasts from three to five years, your unsecured debt will be discharged. Keep in mind that even missing one payment can be enough for your case.
Keep with what you have decided to do. Many times you can get repossess property back once bankruptcy has been filed. If your property has been repossessed less than 90 days prior to your bankruptcy filing, there is a good chance you can get it back. Speak with a lawyer that will provide you with guidance for the entire thing.
Look into all the alternatives to bankruptcy before you choose to file for bankruptcy. Loan modification can help if you get out of foreclosure. The lender wants their money, dropping late charges, and in some cases will allow you to pay the loan over a longer period of time. When all is said and done, creditors want their money, so sometimes it’s best to deal with a repayment plan than with a bankruptcy debtor.
Know the rights when filing for bankruptcy. Some bill collectors will tell you that your debt with them can not be bankrupted. There are not many debts that can not be bankrupted, child support and student loans.If any debt collectors tell you that their debts can’t be bankrupted, get a written proof and send it to the general office of your state’s attorney to report this illegal behavior.
Before declaring bankruptcy, be sure you’ve weighed other options. You could find relief from small debts by using a consumer credit counselor. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
It is not uncommon for bankruptcies to elicit feelings of guilt, guilty or ashamed. These feelings do not help you to make rash decisions and cause psychological problems.
For example, you are not allowed to move assets from your name to someone else’s for a year before you file.
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. Chapter 7 bankruptcy completely wipes out your debt. All of your financial ties to the people you owe money to will disappear. If you file using chapter 13 bankruptcy, you will go through a sixty month repayment plan prior to all your debts being completely dissolved. To make the wisest choice, you will need to understand the consequences of each of these two options.
This is considered fraud, and you may even be forced in paying all of it back to credit card companies.
As said in the beginning of the article, personal bankruptcy is always an option. Given that fact, it should be your last resort due to the consequences involved. Protect your assets and avoid even more stress by learning as much as you can before you decide to file.
Be sure that bankruptcy really is your best option. Consolidating current debt could make it easier to manage. Bankruptcy is not a simple, breezy course of action that should be taken lightly. It will have a long-lasting effect of your future credit opportunities. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.