Bankruptcy will always be a stressful event in a person’s life. People sometimes assume incorrectly that they are up against a wall, and there’s no way out. By reading this article, you will soon realize that bankruptcy is not the end of the road for your financial future.
Make sure you’ve exhausted all other options prior to declaring bankruptcy. It is possible to take advantage of other options, like consumer credit counseling. 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.
Do not use your retirement fund or savings to pay off creditors. Leave your retirement accounts untouched unless there is absolutely no other alternative. You may need to withdraw some funds from your savings account, but don’t take everything that is there as you will be bereft of any financial backup if you do.
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. Resisting the temptation to hide income or valuable assets from the bankruptcy trustee is a smart way to avoid potential complications, penalties, and the possibility of being barred from re-filing in the future.
Unsecured Credit
Once the bankruptcy is complete, you may find it difficult to receive unsecured credit. If so, apply for a secured credit card. This will allow you to start building a good credit history while minimizing the bank’s risk. Unsecured credit may be offered to you quicker than you think after doing so.
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. Don’t hold anything back and formulate a smart strategy to deal with the reality you are facing.
Be aware of recent changes, if any, in the bankruptcy code. Bankruptcy law has changed substantially in recent years, and therefore you must understand how such changes may affect your situation. Your state’s website should have the information that you need.
Be sure to weigh all of your options before deciding to file for personal bankruptcy. For example, you may want to consider a credit counseling plan if you have small debts. It is sometimes possible to negotiate smaller payment by yourself. If you do this, make sure you save a written record of debt modifications that are negotiated.
It is important to know how Chapter 7 filings differ from Chapter 13 filings. Do some research about these options so you can choose the best one. If you do not understand what you are reading, talk to your attorney before making that serious decision.
Chapter 13 Bankruptcy
Look into filing Chapter 13 bankruptcy. If you owe an amount under $250,000 and have a consistent income source, Chapter 13 may be right for you. Chapter 13 bankruptcy permits you to remain the owner of your properties, while allowing you to repay your debt using a debt consolidation loan. Generally, this stays in effect for up to 5 years. Afterwards, your unsecured debts clear from your accounts. Remember that missing a payment to the plan will result in your case being dismissed.
Speak with your attorney about ways you can keep your car. A lot of the time, your payments may be lowered due to Chapter 7 bankruptcy. There are certain requirements and restrictions such as a loan that has a high interest rate, cars purchased 910 days before you file, and a steady job history that can help you keep your vehicle.
Remember that your Chapter 7 filing may affect other people in your life as well. When filing for Chapter 7, you won’t be responsible legally for debt signed by co-debtors and yourself. Creditors, however, will hold the co-signer liable for the entire balance of the debt.
Do not use the word “shame”, if you go bankrupt. The bankruptcy process makes people feel guilty and ashamed. These feelings, however, are of no benefit to anyone, and they can be detrimental to your mental health. Keep a positive state of mind to deal with your tough financial situation.
Before you decide to file, make yourself aware of the laws about bankruptcy. 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’s also prohibted to run up debt on credit cards just prior to filing.
Now you can probably see that filing for personal bankruptcy protection does not mean your finances are doomed forever. Bankruptcy is a serious matter, but it can be managed. Making use of the tips you found here will allow you to heal your financial situation.
This is a limited-time offer. We are not able to guarantee availability if you wait!
