Nowadays, more and more people are facing the sad reality that they have no choice but to file for bankruptcy. If you are considering bankruptcy, you are not alone. However, before selecting this option make sure you know everything you need to know before you head too far down the path. The following tips are going to help clarify some bankruptcy confusion for you.
After a bankruptcy, you may still see problems getting any kind of unsecured credit. If this happens, instead you should turn your attention to secured credit cards. This will show other people that you’re serious when it comes to having your credit record in order. After a certain time, you will then be able to acquire credit cards that are unsecured.
Before filling for bankruptcy, determine which assets will be exempted from seizure. To find an itemized list detailing assets exempt from bankruptcy, find the Bankruptcy Code. Make sure that you carefully look over this list prior to filing to discover if your valuable assets will be seized. If you fail to go over this list, you may be unpleasantly surprised sometime down the road if any of your most valued items are seized.
Ask Plenty
Never pay for a consult with a bankruptcy lawyer, and ask plenty of questions. When you arrive at a consultation ask plenty of questions. You should also seek free consultations from several attorneys prior to choosing one. Do not make any final decisions until every question you have has been answered. It’s isn’t necessary to make a choice right away. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.
Before making your decision to file for bankruptcy, double-check to see if other, less drastic options could make sense. For instance, a consumer credit counseling program may be a better bet if your debts are relatively small. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
Look into filing Chapter 13 bankruptcy. If your total debt is under $250,000 and you have consistent income, Chapter 13 will be available to you. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. This lasts for three to five years and after this, your unsecured debt will be discharged. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
Loved Ones
Always make your loved ones a priority. Bankruptcy can really wear down your emotional reserves. It takes a long time, it can be stressful, and people feel unworthy, guilty and ashamed. Many people don’t feel like socializing during the ordeal. Isolating yourself from your loved ones can lead to feelings of depression. For this reason, if you are undergoing personal bankruptcy proceedings, you must continue to live a normal life, spending time with your friends and relations.
Think about all your options before pulling the trigger. Talk with a bankruptcy lawyer and ask about alternatives, such as debt consolidation or negotiating with creditors. Loan modification can help you get out of foreclosure. Your creditors will be willing to work with you to allow you to pay off your debts. They may be able to take late fees off of your account, cut down your interest, or even extend the loan’s repayment period. Above all else, what creditors want is to get their money. Sometimes they would rather settle for a repayment plan instead of a debtor who is bankrupt.
If you are worried about your car being repossessed, consult your attorney about trying to get the monthly payment lowered. 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.
Chapter 7
Remember that filing for Chapter 7 personal bankruptcy will not just affect you. Think about the effect it will have on business associates, friends and family or anyone else who may be a co-signer with you. If you choose Chapter 7, you are no longer responsible for joint debts. Creditors, however, will hold the co-signer liable for the entire balance of the debt.
File for bankruptcy before your finances get completely out of control. The judge reviewing your petition will consider your recent behavior, purchases, income and payments when making a decision. Your debt can quickly get way too large, and as a result, you may discover that you must foreclose your home or garnish some of your wages. Once you are aware that your financial situation is not manageable any more, your best bet is to speak with a bankruptcy attorney and find out what he or she recommends.
Before you file, make sure you understand the laws as much as possible. As an example, it is prohibited for someone to transfer assets from the filer’s name for one year prior to filing. It is also illegal for someone who files for bankruptcy to drastically increase their debts on credit cards immediately before filing.
Learn and understand the laws and rules regarding personal bankruptcy filings, before you decide to file. If you do not file for bankruptcy properly, you might run into a lot of different issues. It is even possible for your whole petition to be thrown out of court due to errors being made. Thoroughly research bankruptcy before you make the decision to file. Doing so will make the process a lot easier.
Consider all of your options before filing for bankruptcy. One good option might be credit counseling. A number of non-profit companies can assist you. Their job is to lower your payments and interest through negotiations with your creditors. Your payments are made to the organization and they repay the creditors.
As mentioned, bankruptcy is a popular topic today because of the economy. To make certain you are making wise choices about bankruptcy, make certain to use the information in this article.
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