What You Should Know About Personal Bankruptcy
Declaring bankruptcy is a negative process. A bankruptcy will stay on your record for years and can affect the types of credit you are able to get. Use the tips in this article to learn how you can avoid bankruptcy.
Do not attempt to pay your taxes with your credit cards and subsequently file for bankruptcy. In many areas of the country, this debt will not be dischargeable, and you could be left owing a significant amount to the IRS. One thing that you should remember is that if your tax is dischargable, your debt will also be dischargeable. So, in short, do not use your credit cards to pay off debts right before you file for bankruptcy.
Always be honest when filling out paperwork. You must avoid the temptation to conceal any valuables, money or other assets from the courts. If they find that you have lied, you may be faced with fines, penalties or the inability to file in the future.
Never shirk on the truth in your petition for bankruptcy. As long as you are not hiding income or assets from the courts, you can ensure that there are no difficulties with your petition. This will save you from having your petition dismissed and your debts dropped from re-filing.
Be sure to remind your lawyer if it seems that some details of your situation are forgotten. Chances are that you may have forgotten to tell them about certain specifics that may be important to your filing. This is your future in their hands, so don’t be scared to mention it.
Most bankruptcy lawyers give free consultation, so try to meet with these types of lawyers before deciding on hiring one. Just be sure that the person you speak with really is the lawyer, rather than a paralegal, since they cannot legally give advice. Considering several different lawyers can help find someone to trust.
After filing for bankruptcy, you may have difficulty getting approved for unsecured credit. Since it is important that you work to rebuild your credit, you should instead think about applying for a secured card. By doing this, you will be letting people know that you want to fix your credit score. After using a secured card for a certain amount of time, you might be offered an unsecured card once again.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. There are several assets which are exempt from bankruptcy; therefore, consult the Bankruptcy code. It’s crucial to read that list before filing to see which of your prized possessions can be seized. If you do not read this list, you could be in for some nasty surprises in the future, if some of your most prized possessions are seized.
Protect your house. Filing for bankruptcy does not always mean you will end up losing your home. Whether you get to keep your home depends on a few things, including its value and whether you have debts like a second mortgage or HELOC. Otherwise, look into the homestead exemption which may allow you to stay in your home if you meet financial threshold requirements.
If you can afford to pay your bills, bankruptcy is not a wise option. Bankruptcy may appear like the easier way to avoid paying your old bills, but it is a huge mark on your credit score and remains there for up to 10 years.
See if your attorney can help you lower your payments if you want to keep your vehicle. Sometimes, as part of the bankruptcy filing, your auto loan can be restructured so that you pay less each month. There are qualifications, such as the loan being high interest and a good work record for this option.
Chose the proper moment to make your move. They say timing is everything, and this rings true when filing for bankruptcy. In some cases, it is better to file immediately, while other situations benefit from trying to get certain finances in better shape before filing. Consult with an attorney who specializes in bankruptcy so you know when it is a good time to file.
Do not wait until things go from bad to worse before filing bankruptcy. Some folks ignore financial difficulties for a long time, and this can be disastrous. It is easy you to lose control of your debt, and avoiding the problem will make things worse. As soon as you realize your debts far outweigh your income, call a bankruptcy lawyer to talk about what your choices are.
If you intend to file bankruptcy soon, you may want to discontinue paying all debts. Bankruptcy laws generally prohibit certain creditors from being paid back 90 days before filing and family can be around a year! Do your research rather than making financial decisions blindly.
If you are thinking about filing for bankruptcy, one of the first things you should do is look into the laws of your state. You need to know certain things, like the fact that it’s illegal to transfer any asserts 12 months before filing your claim. Also, you can’t go and max out your credit card just because you are about to file for bankruptcy.
Before filing personal bankruptcy, consider other options. Credit counseling may work for you. Many different non-profit entities exist that can assist you without charging you any fees. Their job is to lower your payments and interest through negotiations with your creditors. You make your monthly payments to the credit counselors, and they pay the money to each creditor.
Do not hesitate or stall when determining if filing for bankruptcy is the correct choice for your life and situation. As with anything in life, putting off important things such as debt repayment can snowball quickly out of control. Speaking with a professional in a timely manner will allow you to receive sound advice that can help you before things get out of hand.
Normally, you will not lose your assets when filing bankruptcy. Your personal items will stay with you. You may keep personal items like jewelry, household furnishings, clothes and electronics. This will depend on your state’s laws, the type of bankruptcy you file for, and your financial situation, but you may be able to retain large assets like your home and car.
When a bankruptcy becomes a possibility, you should look at retaining a lawyer. An attorney can assist you both in ascertaining if bankruptcy is what you need and dealing with the court appearance. Your lawyer also knows how to properly file the paperwork and can answer any questions that you have.
As you have learned, bankruptcy can be avoided. The tips here can help provide you with some guidance to avoid filing bankruptcy. If you begin using the tips you learned right away, you will surely see a big change in your life, and perhaps you will be able to save your credit history.
One thing to consider is that filing bankruptcy might be a better alternative to making late payments or missing payments completely. Although your credit will take a big hit, you can begin to repair it immediately after filing bankruptcy. The main benefit to filing for bankruptcy is the chance at a new start.