Jun 122017

It can be very hard to live with bankruptcy. You realize how limited you are when it comes to a tight financial situation. But, even those with damaged credit histories have options when it comes to securing homes and vehicles, as the following article explains.

Do not try to get clever by paying your taxes via credit card before you declare bankruptcy in an effort to dodge your tax burden. 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. So, there is no reason to use your credit card if it will be discharged in the bankruptcy.

If you are faced with the choice of filing for bankruptcy or using your emergency fund or retirement accounts to pay creditors, opt to file for bankruptcy. Leave your retirement accounts untouched unless there is absolutely no other alternative. Though you may have to break into your savings, keep some available for difficult times. You will be glad you did.

It is simple math; when you owe more than you are able to pay off, a bankruptcy is the likely solution. If this describes your situation, it makes sense to become familiar with relevant laws. Each state has their own bankruptcy laws. You may find your home is safeguarded in one state, while in another it isn’t. Be aware of bankruptcy laws before filing your claim.

The best way to build your credit up after a bankruptcy is making all your payments on time. If you find that to be the situation, consider requesting secured cards. You can exhibit your desire to rebuild your credit this way. After some time passes they may be willing to offer you unsecured credit.

Be sure that bankruptcy really is your best option. Many times a consolidation loan will ease your financial struggles. There is not easy process associated with personal bankruptcy. It will affect your access to credit in the future. Therefore, before you file for bankruptcy you need to consider all of your alternatives.

Do not let bankruptcy consume you, make sure you make time for your friends and family. Going through a bankruptcy can be an excruciating experience. It is long, full of stress and leaves individuals having feelings of shame and guilt. A lot of folks decide to hide themselves from the world around them until the end of the process. You shouldn’t do this, though, as staying away from the world can amplify any emotional issue you are having, and they could even morph into full-blown clinical depression. So, even though you may be ashamed of the situation you are in, you should still be around those you love.

Before you proceed with your personal bankruptcy case, review your decisions to be certain that the choice you are making is the right. It is possible to take advantage of other options, like consumer credit counseling. Bankruptcy stays on your credit for a whole decade, so if there are less drastic options that will solve your credit problems, it is in your best interest to make use of them.

It is in your best interest to be abreast of your rights in petitions for bankruptcy. Do not rely on your debtors information about whether or not certain loans can be included in your bankruptcy. Only a few debts, including child support and tax liens, are ineligible for bankruptcy. If you are told differently by a collector, research the information yourself. If you find they are in error, get the name of their company, phone number and any identifying info so you can report it to the attorney general in your area.

Don’t wait until the last minute to file bankruptcy. A lot of people ignore their financial problems, thinking they are going to go away; that is a big mistake. If you have failed to make payments for several months but have continued making purchases on credit, your petition may be denied. The minute you realize that your debts are too big to take care of, contact a bankruptcy attorney to discuss your options.

Financial Information

One of the most important things to remember when filing for bankruptcy is to be honest and truthful every step of the way. Withholding or lying about certain information can seriously worsen your financial situation. It could lead to being unable to file for bankruptcy or even legal trouble.

When filing for personal bankruptcy, always supply all of your financial information. If you do not complete your financial profile your case could be delayed or dismissed. All financial information needs to be considered by the court. Some things to be included are: current loans, valuable vehicles and side jobs.

Even though you may have filed for bankruptcy, you hopefully realize that it does not doom your forever. Saving your money goes a long way to show your lenders concrete proof that you are serious about reestablishing your credit. All you need to do really is start saving your money and rebuild your credit so that you have a chance to get that next loan.

You Can Keep Property When Filing Chapter 7 Bankruptcy

Most people are under the misconceptions that if they file for bankruptcy, then they will lose all of their property. This is simply not the case. Most people who file for Chapter 7 bankruptcy retain all of their personal property. That is because the state of Illinois provides exemptions as it related to personal property. This means that a certain value of property is protected while going through the bankruptcy process. The transcript of the video below talks about the specific dollar amounts in greater detail.

Jesse Barrientes: Some people have bigger boxes, Dave, and some people have smaller ones. So what property then can I continue to keep in a Chapter 7 bankruptcy? Talk about a house. A lot of people have -- and this is what I find because their home is their home. And people are really, really attached to their homes, especially if they have family and they have smaller children; especially in those circumstances. But a lot of times, they've made certain that they have paid their mortgage and they are up-to-date on it. They are not behind on it. It's just everything else.

David Siegel: Remember, a house is not a home without love, Jesse.

Jesse Barrientes: Oh, boy. That's good, that's really good, Dave. So there are some houses out there but not necessarily homes.

David Siegel: Yeah, all right. Under Illinois law, getting back to the business here, you are allowed to protect as an individual up to $15,000 worth of equity in real estate. So if you are filing husband-and-wife, you can protect up to $30,000. And in reality, you can protect a little bit more than that because the trustee would have to sell the property, liquidate it, pay you your exemption and there's costs involved in that.

Jesse Barrientes: bSo I get -- if I'm over the exemption and they sell it, then I'm going to get it, my money back.

David Siegel: Right. As far as a vehicle, you are entitled to a $2400 exemption in one motor vehicle.

Jesse Barrientes: Just one.

David Siegel: Just one. Husband-and-wife case with one car, you can double that to $4800.

Jesse Barrientes: Okay, so $2400 for your car and $2400 for my car. That's how that would work.

David Siegel: Exactly. And, very importantly, there's a $4000 wildcard exemption that you can use to cover any kind of personal property. So in a joint case husband-and-wife, we are talking about $8000.

Jesse Barrientes: So my personal belongings in the house, my clothes, cufflinks.

David Siegel: Your bank accounts, you can put it on your car. You just can't put it on real estate because real estate is not personal. It's real property.

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