Being severely in debt is a very frightening experience. Sometimes, it just snowballs from having a little bit of a financial issue to losing complete control in a short amount of time. When you find yourself in that position, it is not so simple to repair. This article will help you decide if bankruptcy is the way to resolve your debt problems, and if it is, give you some tips for navigating the process.
Millions of Americans file for bankruptcy each year because they can not pay their bills. If this sounds like you, start familiarizing yourself with your state laws. Each state has its own set of rules regarding bankruptcy. For instance, in some states, you can’t lose your home to bankruptcy, while in other states, you can. It is important to be cognizant of the laws in your state before filing for bankruptcy.
Don’t pay tax requirements with your credit cards with the thought of starting the bankruptcy process afterward, without doing your research first. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. Remember that if you can discharge the tax you can discharge the debt. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
Retirement Accounts
Avoid exhausting your savings or emptying your retirement accounts to pay off creditors if you are considering filing for bankruptcy. Don’t touch retirement accounts unless you don’t have a choice. Using your savings is necessary, but decimating it and leaving yourself dangling with no future financial security is not a good idea.
The most important tip a person filing for personal bankruptcy can remember and follow is to be completely transparent in all dealings. Do not hide any income or assets or go on a spending spree before filing for bankruptcy: the court will find out and will not have a positive opinion of you.
Be as honest as you possibly can when filing for bankruptcy; hiding liabilities or assets will only hurt you in the long run. Good or bad, you must tell your bankruptcy attorney everything about your financial situation. Don’t hold anything back and formulate a smart strategy to deal with the reality you are facing.
Keep at it! Certain property cannot be repossessed while you are in the process of filing for bankruptcy so be sure to learn about the laws in your state. If you have property repossessed less than ninety days prior to filing your bankruptcy, you may be able to get it back. Get the advice of a qualified attorney who can advise you about ways to accomplish this.
Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask a lot of questions. Most lawyers offer free consultations, so consult with a few before settling on one. Only make your decision if all your questions and concerns are adequately addressed. You do not need to make a decision immediately after the consult. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.
Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. Go to a specialized lawyer to ask your questions and get some useful advice on what to do.
Remember to only file for bankruptcy if you need to. It may be that all you really need to do is consolidate some of your debts. Filling for bankruptcy is a lengthy, stressful process. Your credit will be impacted for many years. Therefore, before you file for bankruptcy you need to consider all of your alternatives.
Before ultimately deciding whether or not to file for bankruptcy, be sure to weigh the different options available to you. Consult with a bankruptcy attorney to see if an interest rate reduction or debt repayment plan is an alternative to filing for bankruptcy. Loan modification can help you get out of foreclosure. The lender can help your financial situation by getting interest rates lowered, dropping late charges, and in some cases will allow you to pay the loan over a longer period of time. Creditors want their money. Often, they are willing to work out repayment plans with you in order to get it.
An understanding of your rights is important before filing for bankruptcy. It is not unusual for creditors to claim that their debt is not able to be discharged. Only a few debts are immune to bankruptcy. Taxes, student loans and child support would be the major ones. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Do not doddle with whether or not bankruptcy is for you. It can be difficult to ask for help, but as you wait, you accrue more debt. Talk to a lawyer as soon as you can to get the advice that you need.
The first step to making your bankruptcy successful is to turn over a new leaf and decide to manage money better. Be certain not to incur extra debt or increase the amount of debt you already have. In the course of a personal bankruptcy filing, your creditors and the court will examine your credit history right up to the filing date. Let them see how you are making positive changes to your personal financial management by demonstrating what you are doing right now.
There are often times when you feel that you have very little control over what is happening to you. In this article, you were presented with some tips on regaining control of your money and debt. Apply the tips you learned from this article into your life.
This is a limited-time offer. We are not able to guarantee availability if you wait!
