It is common for those who face bankruptcy to experience feelings of despair, rage, frustration and sadness. Those who file bankruptcy worry they will be stuck and unable to pay their bills and still live their lives everyday. They think they are stuck, but they really aren’t, and neither are you, thanks to the following tips.
Always be honest when filling out paperwork. Lying on your filing can cause dire consequences such as: delays, penalties, being prevented from re-filing, or even jail time.
You are going to get found out and get in trouble if you don’t disclose all your assets, so be totally honest from the beginning. It is necessary to be open regarding both the positive and negative aspects of your financial life. Put everything out on the table and craft a wise plan for handling the situation the best you can.
Weigh all of your options before declaring bankruptcy. You could find relief from small debts by using a consumer credit counselor. You could even negotiate for lower payments. However, you should ensure that you always obtain a written record of all the changes to your debt that you’ve agreed to.
Chapter 13 Bankruptcy
Remember to understand the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. Chapter 7 is the best option to erase your debts for good. Any ties that you have with creditors will be dissolved. With a chapter 13 bankruptcy, a 60 month period of time will be established in which you will repay the as much of your debt as possible. Following the 60 month period of time, the remainder of your debt will be excused. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Make time to visit with family and friends during the bankruptcy process. The process for bankruptcy can be hard. Not only is the process long, but it can be stressful, and many people feel ashamed when they do it. Many people don’t feel like socializing during the ordeal. This is not a good idea because staying alone could cause serious problems with depression. Remember that it is not your families fault for your financial hardships and use this time to pull together and be strong.
If keeping your vehicle is of great concern, ask your lawyer if you can secure a payment modification. Often, you can negotiate a lower payment through bankruptcy. In order for this to succeed, you must have bought your car in excess of 910 days before filing, have a higher interest loan for it as well as a consistent work history.
Before you decide to file for Chapter 7 bankruptcy, consider how it could affect other people on your credit accounts, such as family members or business partners. Debts which you shared with another will not be your responsibility any longer if you file for personal bankruptcy under Chapter 7. However, your creditors will be able demand that your co-debtor pays the debt off in full.
If you are in the midst of a Chapter 13 bankruptcy, it is possible to apply for certain loans. It is much harder. Before you can take out a new loan, you will have to clear it with your trustee. Document your budget to prove that you’re going to be able to make the payments. Also, you need to be ready to say why you’re going to need the item.
It is in your best interest to be abreast of your rights in petitions for bankruptcy. Bill collectors will lie to you and say you can’t have their bill discharged. However, there are few debts that cannot be eliminated, like student loans and child support payments. If you are speaking to debt collectors about another type of debt and they tell you it cannot be discharged, check your local regulations. You can report the collectors to your state attorney general if they are lying about this.
Do not think of filing for personal bankruptcy as a shameful thing. Bankruptcy can sometimes leave people feeling guilty, ashamed and alone. Try not to give in to these feelings, as they are of no help to you and they can affect your emotional health. Keep a positive state of mind to deal with your tough financial situation.
Do not put off filing for bankruptcy. Do not avoid your creditors; they will not go away. It is important to decide on a course of action as soon as you begin experiencing financial problems. Debt can snowball very fast, and by ignoring it, you increase the chances of worse problems, such as foreclosure and wage garnishments. As soon as you realize your debts far outweigh your income, call a bankruptcy lawyer to talk about what your choices are.
After reading this article, you should be able to see that personal bankruptcy isn’t so bad. It can be difficult in the beginning, but bankruptcy can be effectively managed. If you use these tips and ideas, you will be on your way to a better financial future.