Bankruptcy is a hard decision, but sometimes a necessary one. The best way to deal with the process is to become educated on the subject. Keep reading for some solid wisdom from people who have themselves gone bankrupt.
Instead of jumping into a bankruptcy filing, be sure your situation requires it. It is possible to take advantage of other options, like consumer credit counseling. Bankruptcy is a permanent part of your credit, so before you make such a big decision, you might want to explore all other choices so that your credit history is affected as minimally as possible.
Always be honest and forthright when it comes to your bankruptcy petition. As long as you are not hiding income or assets from the courts, you can ensure that there are no difficulties with your petition. This will save you from having your petition dismissed and your debts dropped from re-filing.
You should never give up. Certain property cannot be repossessed while you are in the process of filing for bankruptcy so be sure to learn about the laws in your state. You may be able to recover repossessed property if the repossession occurred fewer than 90 days ago. Interview and research attorneys before choosing one to help you with your bankruptcy.
Chapter 7
Be certain that you can differentiate between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 eliminates all debts. This includes creditors and your relationship with them will become no longer existent. Chapter 13, on the other hand, involves a five year payment period before any remaining debts are cancelled. Take the time to learn more about these different options so you can make the best decision possible.
Most bankruptcy lawyers give free consultation, so try to meet with these types of lawyers before deciding on hiring one. Always ensure that the person you meet with is a real lawyer, not a legal assistant or paralegal. These people can’t give legal advice. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
You can take steps to hang onto your house. Bankruptcy doesn’t always mean you’ll lose your home. It may be possible to keep your home if the value has depreciated, or there is a second mortgage. It can be worthwhile to understand the homestead exemption law to see if you qualify to keep living in your home under the financial threshold requirements.
Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. Be sure you go on the Internet and do your research to see what’s best for you. Learning about bankruptcy is not simple, so call a bankruptcy attorney to make an appointment to ask questions.
Make sure bankruptcy is truely your only option before filing. 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. Sometimes your lender will work with you to help pay off your debt by giving you a lower interest rate, forgiving late fees, or extending the time period of your loan. Because of the fact that creditors would like to see their money they are likely to offer repayment plans versus not getting paid at all if you file for bankruptcy.
Initial Filing
After your initial filing, take time to enjoy yourself a bit and get your mind off of it. It can be several months between the initial filing and the final discharge of debts. This stress could actually cause depression, if you don’t combat it. Once the process is complete your life will improve.
Sometimes declaring bankruptcy is simply the only viable option, even though it’s one that nobody wants to take. Now that you’ve come to the end of this piece, you have some ideas about how the process works. You will find that every journey in life goes more smoothly if you heed the advice of those who go before you, and this one is no different.
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