Many people look down on people who have to file for bankruptcy, and then find themselves in the same situation. Situations like a job loss or a divorce can bring you to a situation where the only solution is bankruptcy. You may find the suggestions in this article very helpful if you are in such a situation.
Visit web sites and read information to learn as much as possible about the topic of personal bankruptcy. The United States Department of Justice, the American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys, all provide valuable information. The more information you have, the more confident you can be about any decision you make and you will know that you are doing the best thing possible for your situation.
Credit Card
Don’t use a credit card to pay off your taxes before filing for bankruptcy. In most states, this is not dischargeable debt. Therefore, you will end up owing the IRS a lot of money. 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.
Do not use your retirement fund or savings to pay off creditors. Retirement funds should be avoided at all costs. While dipping into your savings is likely to be necessary, avoid wiping it out completely to prevent leaving yourself with little financial security in the future.
It is important to remind your lawyer of any details that may be important to your case. Chances are that you may have forgotten to tell them about certain specifics that may be important to your filing. This is your bankruptcy and your future, so never be nervous about speaking your mind.
A free consultation is standard for bankruptcy attorneys, so shop around before settling on one. It is important to meet with the actual lawyer, because paralegals or assistants cannot give you legal advice. Comparing different lawyers makes it possible to find one with whom you work well.
If you are concerned about keeping your car, check with your attorney about lowering the monthly payment. In many cases, you can reduce your payment by filing a Chapter 7 petition. There are a few requirements that you have to meet to be eligible, though. You have to have bought the car more than 2.5 years ago, your loan’s interest rate needs to be over a certain amount, and your employment history has to be good.
During a Chapter 13 bankruptcy, you may still be able to get a mortgage or car loan. This is a lot harder. You need to contact your trustee so you can get approved for a new loan. Document your budget to prove that you’re going to be able to make the payments. Be ready to justify the purchase that you need the loan for, too.
It is in your best interest to be abreast of your rights in petitions for bankruptcy. Many creditors or bill collectors might tell you your debts cannot be included in a bankruptcy. What you can’t file on is very small, like student loans or child support payments. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Whenever you file a petition for bankruptcy, do not leave out any information about your finances or assets. Failing to list these could cause the dismissal or delay of your bankruptcy petition. You might think something is insignificant, but you should add it anyway. This might take the form of odd jobs, extra cars and outstanding personal loans.
Prior to filing, do not use your credit card to get a cash advance, knowing your debts will be eliminated. Not only is this fraud, but you could still be liable to repay the money at the end of the day.
Be mindful of paying off outstanding obligations before you file a bankruptcy petition. You may find that bankruptcy law prohibits you from paying back some types of creditors for 90 days before you file, and a year for family members. Study applicable regulations prior to making any financial choices.
It is possible to exhaust every possible option to improve your financial situation and still find bankruptcy the only solution. If something other than financial irresponsibility has caused your financial problems, there is no need to worry. You can find the information that you need in the article below.
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