Bankruptcy And You – Important Things You Need To Know

TIP! Think twice if you have struck upon the idea of paying off your taxes by credit card and subsequently filing for personal 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.

Bankruptcy will always be a stressful event in a person’s life. Many people are fixated on the question as to how they will repay their debts so much that they are unable to live their daily lives. As you can see, filing for bankruptcy does not mean life is over.

TIP! Instead of jumping into a bankruptcy filing, be sure your situation requires it. There are plenty of other options open to you, like consumer credit counseling.

Prior to filing for bankruptcy, be sure you have investigated all of your alternatives. It is possible to take advantage of other options, like consumer credit counseling. Bankruptcy will leave a permanent scar on your credit report and before you take this huge step, you should search through every available option first, to help try and limit the damage to your credit.

TIP! When you document your financial records, it is vital that you are 100% truthful in order to have a successful resolution to your bankruptcy process. It is vital that you disclose all information about your assets and income so there are no delays or penalties, such as a court barring you from filing again later in the future.

After filing for bankruptcy, you could have trouble acquiring 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. It will take time, but when creditors see a pattern that satisfies their need to see your good faith with payments, you will then be able to apply for unsecured cards.

TIP! Once you file for bankruptcy, you will have a hard time getting loans or credits. In this event, you should attempt to apply for a secured card or two.

Look for a bankruptcy lawyer that comes from a personal recommendation instead of someone random on the Internet or in the yellow pages. There are a number of companies who may take advantage of your situation, so always work with someone that is trustworthy.

TIP! Safeguard your most valuable asset–your home. Filing for bankruptcy does not guarantee that you will lose your house.

Be as honest as you possibly can when filing for bankruptcy; hiding liabilities or assets will only hurt you in the long run. The lawyer representing you when you file needs to have full knowledge of your financial situation. Telling the truth will allow you reach a solution that is feasible, given your current situation.

Chapter 7

TIP! Always make your loved ones a priority. Going through a bankruptcy is never easy.

Be sure you know how Chapter 7 and Chapter 13 differ. Should you choose Chapter 7, your total debt load will be erased. You will be removed from any contracts you have with your creditors. On the other hand, filing for bankruptcy under Chapter 13 means you will have 60 months to pay your debts back. You have to know what differs between all of the kind of bankruptcy, so you know which is one is ideal for you.

TIP! Remember that your Chapter 7 filing may affect other people in your life as well. Once you file for Chapter 7 bankruptcy protection, you no longer have legal responsibility for debts that you and any co-signers originally agreed to.

It is important to understand clearly the benefits of a Chapter 7 or 13 bankruptcy. Learn the benefits and drawbacks of each type before deciding which is right for you. Ask your bankruptcy lawyer to clarify anything you don’t understand before making a final decision about which type of bankruptcy to file.

TIP! You should never feel shame for needing to file for bankruptcy. Going through bankruptcy can cause you to lose a lot of self-esteem.

Consider filing using chapter 13 bankruptcy. In most states, Chapter 13 bankruptcy law stipulates that you must have under $250,000 of unsecured debt and a steady income. This lets you keep any real estate and personal property while you repay all your debts through a consolidation program. These kinds of plans usually range across 3, 4 and 5 years. Once this is done, all your unsecured debt will get discharged. Remember, though, that if you fail to make even one payment, the case will be thrown out and you’ll be right back where you started.

TIP! Facing bankruptcy is not a fun situation and cause a lot of stress and anxiety. The best way to lessen this stress is to employ a lawyer, who can handle most of it for you.

Now that you’ve read this article, I hope you can see that having personal bankruptcy doesn’t necessarily mean doom for you. Although it is hard at first, you will get through it. Put the information you have found in this article to use so that you can have a very successful bankruptcy.


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