Tips On Fixing Your Finances After Bankruptcy
The specter of bankruptcy can cause many individuals to break out in a cold sweat. The piling on of debt and not being able to support their family is an awful situation for many to ponder. If this applies to you, or if you are worried about it happening, this article can help.
Before filing for personal bankruptcy, make sure you are doing the right thing. Debt advisors are one of the many other avenues you can consider. 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.
If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. You should not use your retirement savings unless the situation calls for it. Although you may need to tap into your savings, you should not use up all of it right now and jeopardize the financial security of your future.
A key tip for those filing a personal bankruptcy petition is to always be completely honest in all documentation. You may be tempted to try to hide income and personal assets from discovery, but doing so often leads to major complications, monetary penalties and the possibility that your case will be thrown out of court.
Prior to putting in the bankruptcy paperwork, determine what assets are protected from seizure. The Bankruptcy Code lists the kinds of assets which are exempted when it comes to the bankruptcy process. It is vital that you know the things on this list prior to filing for bankruptcy, in order to determine which of your possessions will be taken away. If you fail to go over this list, you may be unpleasantly surprised sometime down the road if any of your most valued items are seized.
Chapter 13
Make sure that you understand the difference between Chapter 13 bankruptcy and Chapter 7 bankruptcy. Every one of your debts will be gone if you decide to go with Chapter 7. With very few exceptions, the connections between you and your creditors will be severed. Filing Chapter 13 differs by requiring you to agree to a 60 month plan to repay your debts before they are totally eliminated. You have to know what differs between all of the kind of bankruptcy, so you know which is one is ideal for you.
There are differences between Chapter 13 bankruptcy and Chapter 7; be sure to familiarize yourself with both. Do some research about these options so you can choose the best one. Learning about bankruptcy is not simple, so call a bankruptcy attorney to make an appointment to ask questions.
Learn what you can about Chapter 13 bankruptcies. If your total debt is under $250,000 and you have consistent income, Chapter 13 will be available to you. The benefit of this plan is that you retain personal belongings and private real estate and your debts are repaid by an organized payment plan. 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.
It is not unusual for people to be worried about bankruptcy; the process is nerve-wracking. You might have been worried about it before, but this article can put those fears to rest. By using the tips and information you’ve gathered here, you will be able to face your fear head on and look forward to a brighter financial future.
