Just thinking of filing for bankruptcy can scare a person. Ever increasing debt, along with the difficulty of supporting a family is very frightening for some people. Does the thought of this scare you? Perhaps you are going through it right now, and the advice found here can help your situation.
Generally bankruptcy is filed when a person is facing insurmountable debt. If this is the case for you, you should begin to investigate the legislation in your state. Different states have different laws regarding bankruptcy. Some states protect your home, and others do not. Make sure you know the laws where you live before you file.
Learn as much as you can about bankruptcy by going to informational websites. The United States D.O.J., the A.B.I and the N.A.C.B.A. are all useful organizations willing to provide educational material. The more you know, you can be confident you are choosing the right thing and that you are taking the right road to make sure your bankruptcy proceeds as easily as possible.
Credit Card
If you are thinking about paying off your tax obligations with a credit card and then filing bankruptcy, think again. Generally speaking, taxes are not a dischargeable debt. The delays caused by this sort of tactic could leave you owing the IRS a great deal in interest and penalties. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. Thus, it doesn’t make sense to use a credit card when it is going to be discharged when you file for bankruptcy.
When bankruptcy seem inevitable it is important not to use your retirement funds or emergency savings to pay creditors. Retirement accounts should never be accessed unless all other options have been exhausted. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
Consider other alternatives before filing for bankruptcy. For example, consumer credit counseling programs can help you by renegotiating your debts with your creditors into payments that you can afford. You can also talk to creditors and ask them to lower payments, but be sure to get any debt agreements in writing.
Chapter 13
Be certain to grasp the distinction between Chapter 7 and Chapter 13 bankruptcy cases. In Chapter 7 bankruptcy, your debts are all eliminated. Any ties that you have with creditors will be dissolved. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. Look into both types of bankruptcy before deciding which one would suit your particular needs.
There are differences between Chapter 13 bankruptcy and Chapter 7; be sure to familiarize yourself with both. Weigh all the information you can find on- and off-line to make an educated decision. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.
Once your bankruptcy filing is under way, take the time to decompress a little. It can be several months between the initial filing and the final discharge of debts. It is essential to cope with this stress well, to prevent becoming depressed. Your life will see improvement after you get past the bankruptcy.
If you meet certain requirements, you may be able to get a lower monthly payment on your financed vehicle. You can often lower your payment using Chapter 7 bankruptcy. You need to have bought your car 910 days before you file, have a loan with high interest and you’re also going to need a good work history.
A great tip to remember if you have filed for Chapter 13 is that you will still be able to receive a loan, so you shouldn’t refrain from trying. There are extra hoops to jump through. You will need to go through various hoops in order to be approved for any new loan type. You need to show them why and how you can handle paying back the new loan. You will also need to have a good reason why you need the item.
Bankruptcy can be quite frightening, so it is understandable that many people are afraid of it! Though the fear may be great, you can alleviate some of that with this article. Apply what you’ve learned here, and get a fresh start for you and your family.
This is a limited-time offer. We are not able to guarantee availability if you wait!
