Information Everyone Should Know If They File For Bankruptcy

TIP! The most important tip a person filing for personal bankruptcy can remember and follow is to be completely transparent in all dealings. Withholding or lying about certain information can seriously worsen your financial situation.

You are not alone if you have become a victim of debt. Filing chapter 7 or 11 can be the last option for many people. If this description applies to you, you may wish to think about filing for personal bankruptcy. Read the following paragraphs to decide if this path is one that you should take.

TIP! Do not despair, as it’s not the end of the world. Once bankruptcy has been filed, you may be able to regain possession of items such as electronic goods or cars that were taken away from you.

It’s important that you understand what bankruptcy is and how it will change your life before you attempt to file a claim. Many sites, including the U.S. Department of Justice, the American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys, all provide valuable information. The more you know, the better equipped you’ll be to make the wise decisions needed for a successful bankruptcy.

TIP! Learn all the latest laws before you file bankruptcy. Bankruptcy law has changed substantially in recent years, and therefore you must understand how such changes may affect your situation.

Do not pay your taxes with credit cards that will be canceled when you file for bankruptcy. You will find few states that discharge this kind of debt. You may also wind up owing a lot of 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.

TIP! Prior to declaring bankruptcy you really need to be sure that you’ve exhausted all your other options first. You could find relief from small debts by using a consumer credit counselor.

Honesty is of utmost importance during your filing, even though it may be tempting to “pad” your answers a little. Not hiding any assets or income is essential for avoiding possible penalties and your ability to re-file at some point in the future.

TIP! Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. Weigh all the information you can find on- and off-line to make an educated decision.

Instead of getting your lawyer from the yellow pages or on the Internet, try your hardest to find one with a personal recommendation. There are way too many people ready to take advantage of financially-strapped individuals, so you must ascertain that your attorney can be trusted.

TIP! You could see about filing for Chapter 13 personal bankruptcy. If you have regular income and under $250K in unsecured debt, a Chapter 13 may be right for you.

Do some research to find out which assets you could lose by filing for personal bankruptcy. Bankruptcy exemptions are properties may not be seized during bankruptcy. It is important that you read this list before filing for bankruptcy, so that can find out whether or not your most prized possessions will be seized. If you fail to do so, things could get ugly.

TIP! Avoid filing for bankruptcy if you make more money than your monthly bills. The cost to your credit history far outweighs the simplicity of the easy-out bankruptcy.

Investigate your other alternatives before you decide you have to go with bankruptcy. Maybe you can just consolidate debt to make it simpler to deal with. Bankruptcy cases are long, anxiety-filled experiences. You will have trouble getting credit down the line. You have to make certain that you absolutely have no other choice.

Chapter 13

TIP! Never forget that you still deserve to enjoy life while you go through the bankruptcy process. It is common for people to stress when filing.

Learn what you can about Chapter 13 bankruptcies. If you have a regular source of income and less than $250,000 in unsecured debt, you can file for Chapter 13 bankruptcy. This allows you to keep possession of your real estate and property and repay your debt through a debt plan. The plan is usually for a term of three to five years, and a discharge will be granted at the end of that term. Remember that you must make every payment. Missing even one could cause the court to dismiss your case.

TIP! Be sure you know the bankruptcy laws before you think about filing. For example, it is forbidden for an individual to transfer any assets away from the name of the filer within the twelve months preceding filing.

It is important to look at your financial situation from all possible angles before you decide to file for bankruptcy. Consult with a bankruptcy attorney to see if an interest rate reduction or debt repayment plan is an alternative to filing for bankruptcy. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. The lender is able to help you in a number of ways, such as reducing interest rates, eliminating late charges, and even lengthening the loan, giving you more time to pay. Because of the fact that creditors would like to see their money they are likely to offer repayment plans versus not getting paid at all if you file for bankruptcy.

TIP! If you know that you are about to file for bankruptcy, don’t exploit the information asymmetry and get huge cash advances on your credit cards. This is illegal.

Before filing for bankruptcy, learn your rights. Collectors may try to convince you that your debt can’t be discharged. There are not many debts that can not be bankrupted, student loans and child support for example. If a collector tries to convince you that some other type of debt, such as a credit card, is non-discharagable, get the company’s information and send a report to your state attorney general’s office.

TIP! Be mindful of paying off outstanding obligations before you file a bankruptcy petition. Bankruptcy laws generally prohibit certain creditors from being paid back 90 days before filing and family can be around a year! Do your research and figure out the laws for you.

Hopefully, you now understand that there are many options open to you when you are giving a personal bankruptcy filing serious thought. When you handle it correctly, a bankruptcy can resolve a great number of your financial troubles and enable you to start turning your life around.


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