Many people fear the thought of bankruptcy. Between rising debt and pressure from the family, it can leave you sleepless at night. The following advice will greatly help you if bankruptcy is a fear of yours.
Instead of jumping into a bankruptcy filing, be sure your situation requires it. Alternatives do exist, including consumer credit counseling. Be sure to consider all options before filing for personal bankruptcy, as this will take a large toll on your credit score for the next ten years.
After a bankruptcy, you may still see problems getting any kind of unsecured credit. If so, apply for a secured credit card. This will demonstrate that you’re seriously trying to restore your credit. After some time passes they may be willing to offer you unsecured credit.
A lot of people find themselves needing to file bankruptcy when they are unable to pay their bills. If this sounds familiar, you should read up on the bankruptcy laws in your state. Each state has their own bankruptcy laws. In a few states, they see to it that your house is protected. This is not the case when it comes to other states. Do you research about legal ins and outs in your state before you begin the bankruptcy process.
When looking for a lawyer to handle your bankruptcy claim, the best way to go is off of a personal recommendation instead of simply flipping through the phone book. Companies are constantly popping up, claiming to help, yet only seek to profit from your misery. In ensuring that your bankruptcy is as simple as possible, trusting your attorney makes a big difference.
Find out what you exemptions are prior to filing bankruptcy. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. It’s crucial to read that list before filing to see which of your prized possessions can be seized. If you don’t read this list, there is a chance that you might get nasty surprises when they take your things away.
Chapter 13 Bankruptcy
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. In some places the debt can not be discharged, and you may still need to pay the IRS afterward. If the tax can be discharged, so can the debt. Thus, it doesn’t make sense to use a credit card when it is going to be discharged when you file for bankruptcy.
Know the differences between Chapter 7 and Chapter 13 bankruptcy. All debt will be eliminated with Chapter 7. Any debts that you owe to creditors will be wiped clean. Chapter 13 bankruptcy allows for a five year repayment plan to eliminate all your debts. It’s imperative that you know the differences among the various categories of bankruptcy so that you are able to choose the wisest one for you.
Your most important concern is to protect your home. Filing for bankruptcy doesn’t automatically involve losing your home. If your home has significantly depreciated in value or you’ve taken a second mortgage, it may be possible to retain possession of your home. There are also homestead exemptions which, depending on your other finances, may allow to remain in your home.
Remember to only file for bankruptcy if you need to. You might be better off consolidating your debt or availing yourself of some other remedy. It is not a quick and easy process to file for bankruptcy. It will also limit your ability to get credit for the next few years. This is why it is crucial that you explore your other debt relief options first.
Be certain you are making the right choice before you file for bankruptcy. There are plenty of other options open to you, like consumer credit counseling. If you file for bankruptcy, a mark is permanently left on your credit. Therefore, before you do this, you should utilize all the other options that you have.
There are circumstances where you are able to keep your car during a bankruptcy so be sure to ask your lawyer about possibly reducing the payments. Filing under Chapter 7 is usually a good way to lower your payments. In order for this to be considered, your car loan must be one with high interest, you need a solid work history and the car should have been bought 910 days or more prior to you filing.
Filing for bankruptcy can cause stress. One way to help reduce is this stress is to hire a reliable attorney. Do not solely use cost to determine whom to hire. Your attorney does not need to cost a lot, but they do need to have a lot of experience. Speak to those around you at work or social settings, who have dealt with this. Make the most of the BBB and consultations with attorneys to increase your knowledge and decision-making ability. It is even possible to watch a court hearing in order to see how well an attorney handles a case.
Those who are afraid of bankruptcy are entirely justified; it often can be a frightening experience. You may have been scared before, but this article has probably allayed your fears. Apply what you’ve learned here, and get a fresh start for you and your family.
Try to get a bankruptcy lawyer that your friends recommend, as opposed to someone that you find from the Internet or yellow pages. There are lots of unsavory companies and lawyers out there who prey on people who are in desperate straits. It is up to you to find someone that is trustworthy and can make the process go smoothly.