When your debts get out of control, it’s common to start worrying about losing your possessions and assets that you care about most. Cease debt collector calls, then figure out your financial situation by thinking about personal bankruptcy. Continue reading for some useful tips to help guide you through this potentially stressful process.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. If the tax can be discharged, so can the debt. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
When you document your financial records, it is vital that you are 100% truthful in order to have a successful resolution to your bankruptcy process. Remember that if you hide your valuable assets or income from your bankruptcy trustee, you may risk a number of penalties and complications. Among these is the possibility that you could be blocked from ever filing again.
It is important to remind your lawyer of any details that may be important to your case. It is wrong to assume that your lawyer will remember every word you ever utter! Your case and future are affected by the attorney’s action, so never be afraid to communicate.
Unsecured Credit
It can be difficult to obtain unsecured credit once you have filed for bankruptcy. If you do, then try applying for a coupe of secured cards. This will allow you to start building a good credit history while minimizing the bank’s risk. Once you’ve built up a history of on-time payments, you may start getting unsecured credit again.
Try going to a personally recommended bankruptcy lawyer instead of using a phone book or the Internet. There are various companies that prey on the financially desperate, so you need to find someone you can trust to ensure the process goes smoothly,
If bankruptcy is an option for you, secure the services of an attorney. Filing for bankruptcy is a complicated procedure, and you may not be aware of all the ins and outs. A qualified bankruptcy attorney will guide you through the steps and help you do everything properly.
Weigh all of your options before declaring bankruptcy. For instance, a consumer credit counseling program may be a better bet if your debts are relatively small. 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.
A lot of bankruptcy attorneys will let you have a consultation, so try several out. Be certain that the person you meet with is really a lawyer. Avoid meeting with paralegals or legal assistants because they cannot give you legal advice. Comparing different lawyers makes it possible to find one with whom you work well.
Protect your house. You don’t have to lose your home just because you are filing for bankruptcy. For instance, if your home value has dropped recently, or even if you happen to hold a second mortgage, you may not necessarily lose the home. Check to see if you pass the requirements necessary to file for a homestead exemption.
Make sure that you really need to file for bankruptcy. Many times a consolidation loan will ease your financial struggles. It can be quite stressful to undergo the lengthy process of filing for personal bankruptcy. It will have a major effect on your credit as time goes on. This is why it is crucial that you explore your other debt relief options first.
Spending time with the people you love is something you should do now. The process of bankruptcy can seem brutal. At the end of the process, many people are left with feelings of shame and worthlessness. Some people do not even want to speak with others until the bankruptcy is official. On the other hand, isolation of a self-imposed nature can only worsen your feelings, opening the door to mental depression to join your financial depression. This is the reason that you need to take the time out to spend time with everyone you love despite what your financial situation is.
Repayment Plan
It is important to look at your financial situation from all possible angles before you decide to file for bankruptcy. You can get your interest rates reduced or enter into a debt repayment plan. Before you file bankruptcy, ask your attorney if any of these are viable alternatives for you. Loan modification plans can be helpful for those facing foreclosure. The lender wants their money, so they may be willing to forgive some fees, change the loan term or reduce interest as ways of assisting you. When all is said and done the creditors just want their money, and more often than not will work with you on a repayment plan.
Do not forget to enjoy life a little once you get through the initial filing process. It can be several months between the initial filing and the final discharge of debts. Depression and burn-out from pent of stress will do nothing to help your situation, so it is critical to let go a little. Your life will most likely improve once you’re over this hump, so relax.
While personal bankruptcy can always be an option, don’t do it before looking at other options. Bear in mind the fact that a number of services for debt consolidation are actually fraudulent and will cause you more problems. Keep the tips here in mind as you navigate through your financial challenges, and prepare yourself for a more successful financial future.
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