Filing for bankruptcy is quite a simple process. There are multiple ways you can file for bankruptcy, and your personal financial situation will dictate which type you should choose. The following tips will help you make that decision.
Do not attempt to pay your taxes with your credit cards and subsequently file for bankruptcy. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. Keep in mind that if the tax debt is eligible to be discharged, then the credit card debt is also dischargeable. This makes using a credit care irrelevant, since bankruptcy will discharge it.
Don’t use a credit cards to pay off your taxes if you’re going to file bankruptcy. In most states, this debt will not be dischargeable, and in the end you will be left owing the IRS a big sum of money. This makes using a credit care irrelevant, when it will just be discharged.
Retirement accounts should never be accessed unless all costs. You may have withdraw from your savings every now and then, but don’t take everything that is there as you will be bereft of any financial backup if you do.
Any bankruptcy consultation should be free of charge. You can meet with a few lawyers before deciding on one. Most lawyers provide a free initial consultation. Do not make any final decisions until every question you have has been answered. Take your time choosing the right attorney to assist in your bankruptcy. So you have sufficient time to speak with a number of lawyers.
Always be honest and forthright when it comes to your finances.
Understand the differences between Chapter 7 and a 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 you are confused by what you find, go over it again with your attorney before making the final filing decision.
Educate yourself about state bankruptcy laws and possible outcomes before filing your petition. Laws are ever-evolving. You must stay current with bankruptcy laws if you want to be successful in your challenge. Keep up with your current state’s laws and regulations to figure out what steps you should take.
Don’t file bankruptcy the income that you can afford to pay your debts. Bankruptcy may seem to be the easy way out, but it is a huge mark on your credit score and remains there for up to 10 years.
Look into all of your options before filing. Loan modification plans can help if you are a great example of this. The lender can help your financial situation by getting interest rates lowered, 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 push comes to shove, the creditors want their money, so sometimes it’s best to deal with a repayment plan than with a bankruptcy debtor.
Consider Chapter 13 bankruptcy for your filing. With a consistent income source and less than $250k in debt, try filing for Chapter 13. Chapter 13 bankruptcy permits you to remain the owner of your properties, while allowing you to repay your debt using a debt consolidation loan. It usually takes three to five years to fulfill this plan. When the time is up, you’re unsecured debts will be discharged. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
Bankruptcy is a difficult time that always leads to lots of other physical and emotional issues. To have a reliable and trustworthy guide through the process, hire a good lawyer. Do not choose your attorney based on price. It is not be necessary to hire a lawyer of high quality. Make sure people who have experienced bankruptcy give your circle of friends and the BBB. You might want to visit a court hearing to see how an attorney handles his case.
Personal Bankruptcy
Before filing for bankruptcy, establish the fact firmly in your mind that you have nothing to be ashamed of. Many people feel guilty, embarrassed and unworthy when dealing with bankruptcy. Feelings such as these are not of value to you and it is possible for them to be psychologically harmful. Staying positive and upbeat is the proper way to deal with bankruptcy.
Know the rules of personal bankruptcy before you formally file. There are many pitfalls when it comes to the code pertaining to personal bankruptcy laws that could trip up your case. Some mistakes could lead to your case being dismissed. Do as much research on bankruptcy before taking the next step. The proceedings will be much easier when you move forward with this information.
Be careful on how you pay off any of your debts before you file a personal bankruptcy. Bankruptcy rules generally outlaw repayment of creditors in the 90 days leading up to a bankruptcy filing, such as the previous 90 days worth of credit card debt. Read the rules before you make any decisions about your finances.
When filing for personal bankruptcy, always supply all of your financial information. If the court thinks you are attempting to conceal information, your petition could be denied. Add absolutely everything to your list, including small amounts. This includes income from second or part time jobs, vehicles and loans.
Make a quick decision to be more responsible fiscally before you file. Don’t start racking up debt right before bankruptcy. Creditors and judges look at your current and past history when they make a decision about your bankruptcy paperwork. You need to show the court that you are ready to act in a financially responsible manner.
Write down every debt you owe. This will be included in your bankruptcy filing, so make sure you include all the debts you are aware of. Be 100% certain that the exact amount of each debt you are claiming as being owed are true and correct. Don’t hurry through this process too fast because these amounts won’t get discharged if the numbers aren’t right.
Choosing a good lawyer is an important step in the process. Interview your prospective attorney regarding education and experience. Be sure your lawyer has years of experience and is licensed properly. If you want to check for a proper lawyer, you can use the Internet, ask your friends, or look for a popular lawyer via the Yellow Pages. The idea is that you want to ensure your lawyer’s competency on the issue.
As you can see, filing for bankruptcy is a serious decision that must be considered carefully before you make it. If you think it is the right choice for you, find a lawyer that can properly guide you through the process and give you a new leash on life.