Personal bankruptcy is always an option for those who have had possessions, such as vehicles, repossessed by the Internal Revenue Service. While bankruptcy is a big hit to your credit history, it can be the only option. Pay attention to what this article is teaching you about bankruptcies and their pitfalls.
As bankruptcy appears on the horizon, don’t take your savings or retirement accounts to try to pay off all your bills. No matter what you do, do not touch your personal savings unless there is no other option. You may have withdraw from your savings every now and then, but try to leave yourself some financial security for the future.
Check the accuracy of all information before it is filed. It is wrong to assume that your lawyer will remember every word you ever utter! This is your bankruptcy case, so do not be afraid to remind your lawyer of any key facts.
Prior to filing for bankruptcy, discover which assets cannot be seized. The Bankruptcy Code includes a list of the types of assets that are exempt from the bankruptcy process. It is important that you read this list before filing for bankruptcy, so that can find out whether or not your most prized possessions will be seized. 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.
Before filing for bankruptcy, hire a qualified attorney. With all the ins and outs of bankruptcies, it can be hard to grasp all the knowledge. An attorney specializing in personal bankruptcies can assist and make certain things are being handled correctly.
Learn of new laws prior to deciding to file for bankruptcy. Bankruptcy laws are in constant flux, so just because you knew the law last year doesn’t mean that the laws will be the same this year. To learn about the changes, you should check out the website of your state’s legislation or you can call their office.
Many bankruptcy attorneys offer the first consultation with no charge, so consult with several before deciding on one. Meet with the actual lawyer, not a paralegal or assistant, as they’re not allowed to give out legal advice. By meeting with several attorneys through a free consultation you will be able to choose which attorney you feel more comfortable with.
Protect your house. Losing your home is thought of as common in bankruptcy cases, but it is by no means inevitable. Check your home’s current value to see if it has gained equity and get your first and second mortgage papers together. Another option is the homestead exemption that has certain income and financial requirements, but may also allow you to keep your home.
There are differences between Chapter 13 bankruptcy and Chapter 7; be sure to familiarize yourself with both. Research them online to see the positive and negative aspects of each one. If you are confused by what you find, be sure to ask your attorney to explain anything that is unclear before you make your decision about filing.
Chapter 13 Bankruptcy
Find out if you can use Chapter 13 bankruptcy, as it may help you better than the other laws. If you posses a regular source when it comes to income, and you have less than $250,000 of unsecured debt, you could file using Chapter 13 bankruptcy. Not only can you repay your debts through consolidation, personal property can be kept, as well as real estate. Typically, this goes on for roughly three to five years, and once this time has expired, your unsecured debt is eliminated. Remember that if you fail to make any of the payments on time, the court may dismiss your case.
As said in the beginning of the article, personal bankruptcy is always an option. However, it should not be anyone’s first choice because it does not reflect well on credit. Staying informed on how to manage this situation could prevent you from experiencing headaches and it can also help you keep your valuables.
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