The path to bankruptcy is not normally a happy one, but your life can improve once the filing has occurred. The point of bankruptcy is to have a clean slate and a fresh start. Completing the bankruptcy process properly can lead to a new financial future.
Filing for bankruptcy is something many people are forced to do when there debts become too much of a burden, and they can no longer afford to pay them. When you get into this situation yourself, your first step is to familiarize yourself with your local bankruptcy regulations. The laws governing bankruptcy vary from state to state. For instance, your home might be protected in some states while you might lose it in others. Become acquainted with local bankruptcy laws before filing.
Have a good look around the Internet to see what information is relevant to you regarding bankruptcy. The U.S. DOJ, along with a number of other bankruptcy institutes and attorneys specializing in bankruptcy can give you invaluable information. The more you know, the better equipped you’ll be to make the wise decisions needed for a successful bankruptcy.
Unsecured Credit
Getting unsecured credit post-bankruptcy will likely be difficult. If this happens to you, think about applying for a couple of secured credit cards. They offer you the chance to demonstrate the seriousness with which you now take your financial obligations. After some time passes they may be willing to offer you unsecured credit.
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 a number of companies who may take advantage of your situation, so always work with someone that is trustworthy.
Before you decide to file bankruptcy proceedings, determine which assets will be safe. The Bankruptcy Code contains a list of various assets that are excluded from bankruptcy. Make sure to review the list before filing a claim so you know if your valuables will be subject to seizure. While it might not be possible to protect a particularly beloved possession, at least you will know in advance whether or not you risk losing it.
Keep with what you have decided to do. When you file for personal bankruptcy, you may even be able to retrieve personal property that has been repossessed. For example you may be able to get your car, electronics and even jewelry returned to you. If you have been subject to a repossession during the 90 days before your filing, you stand a good change of getting your property back. Interview and research attorneys before choosing one to help you with your bankruptcy.
Chapter 7 Bankruptcy
Remember to understand the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. If you file for Chapter 7 bankruptcy, all of your debts will be eliminated. Your ties with all creditors will get dissolved. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Look into all of your options before you choose to file for bankruptcy. You may qualify for alternatives such as debt repayment plans or interest rate reductions. Ask your bankruptcy attorney about these options. Look into loan modification plans if you need to deal with an imminent 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. At the end of the day, creditors want to get paid, and sometimes a debt repayment plan is preferable to dealing with a bankrupt debtor.
Your trustee may be able to help you secure an auto loan or get a mortgage even though you have filed Chapter 13. But, it could be harder. You need to speak with your trustee so that you can be approved for a new loan. When you meet with your trustee or financial adviser, make sure that you come up with a sound budget proposal. It will also be necessary to show why a new purchase needs to be made.
As stated in the above article, anytime someone is forced into bankruptcy is never a happy situation. It doesn’t have to be that way after bankruptcy. If you use these tips, you may be able to use bankruptcy to make your life better going forward.
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