You should never take the decision to file bankruptcy lightly.It is very important that you educate yourself on the entire bankruptcy filing process. Use the tips in this guide you in the proper direction.
Many people find that they must file for bankruptcy protection because they have more debt than they can afford to repay. If you find yourself going through this, you should know all about the laws that are in your state. Most states differ in their laws governing bankruptcy. For instance, some states protect you from losing your home in a bankruptcy, but others do not. Do not file before learning about the bankruptcy laws in your state.
You have other options available like counseling for credit counselling services. Bankruptcy leaves a permanent mark on your credit history, so before you make such a big decision, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
You shouldn’t dip into your retirement savings unless there is nothing else you can do. Although it is quite normal to use some of your savings, you should not use up all of it right now and jeopardize the financial security of your future.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. Keep in mind that if the tax debt is eligible to be discharged, then the credit card debt is also dischargeable. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
Filing for personal bankruptcy may possibly enable you to reclaim your personal property that have been repossessed, like your car, electronics or other items that may have been repossessed. You should be able to get your possessions back if they have been taken away from you within 90 days ago. Consult with a lawyer that can walk you through the filing of your petition.
Be sure to enlist the help of a lawyer if you’re going to be filing for personal bankruptcy.You may not understand all of your case. A lawyer that specializes in bankruptcy lawyer can make sure you are handling your bankruptcy filing the right way.
If you can, get a word-of-mouth referral for a lawyer. Although you may find a good lawyer through an advertisement, you can simply find a much better lawyer if the lawyer is recommended to you by someone who has gone through the process and who has the inside track on the lawyer’s true capabilities.
Chapter 7
Be certain that you know how Chapter 7 and Chapter 13 differ. Chapter 7 bankruptcy is intended to wipe out all debts. Any debts that you have concerning creditors will definitely be dissolved. Chapter 13 bankruptcy though will make you work out a five year repayment plan that takes 60 months to work with until the debts go away.
Be sure to enlist the help of a lawyer if you’re going to be filing for bankruptcy. Personal bankruptcy is quite complex, and it is entirely possible that you will not be able to familiarize yourself with all the laws and processes. Your lawyer will make sure that the filings are correct and help you navigate the complex process of filing for bankruptcy.
Before filing for bankruptcy consider every available avenue. It may be that all you really need to do is consolidate some of your debt instead. It can be quite stressful to undergo the lengthy process to file for bankruptcy. It will have a major effect of your future credit opportunities. This is why you explore your last resort.
Look at all the alternatives to bankruptcy before you choose to file for bankruptcy. Loan modification plans can help you get out of foreclosure. The lender wants their money, so they may be willing to forgive some fees, 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, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Talk with your lawyer about getting lower payments for any car you wish to keep. Most of the time Chapter 7 bankruptcy will allow your payments to be lowered. You need to have bought your car 910 days before you file, have a loan with high interest and you’re also going to need a good work history.
It is possible to obtain new vehicle and home loans while a Chapter 13 bankruptcy. You will need to secure the approval for any new loan. You need to show them why and prove that you can handle paying back the new loan payments. You will always have to let them know why it is necessary for you to take out the loan.
Be careful on how you are planning to pay off any of your debts before you file a personal bankruptcy. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and family members up to a year! Know the rules before you are going to do.
If you are planning to file for bankruptcy in the immediate future, you should refrain from taking out cash advances via your credit cards. This is illegal. It’s fraud, and you can still be responsible for paying it back even after declaring bankruptcy.
Now you know that there a variety of methods you can use when it comes to filing for bankruptcy. Don’t be overwhelmed by the vast amount of information available. Take a few minutes to turn the information over in your mind and see how it might be useful to you. You’ll be able to make more considered decisions this way.