Has your financial situation made you feel bankruptcy is is your only option? Don’t worry, you are not alone. Many individuals have turned to bankruptcy as a means of finding relief from financial hardship. The piece that follows includes useful ideas for ensuring that the bankruptcy process goes as smoothly as possible.
Credit History
Prior to filing for bankruptcy, be sure you have investigated all of your alternatives. You can also avail yourself of other options, such as consumer credit counseling. Bankruptcy is a serious negative on your credit history so make sure you have no other options before you file. It is important to keep your credit history as positive as possible.
Do not use your retirement fund or savings to pay off creditors. Avoid touching your retirement accounts whenever possible. You may need to tap your savings, but don’t empty your savings account, as this could leave you in a difficult situation down the road.
Be persistent in researching information about filing for bankruptcy and consult a qualified personal bankruptcy attorney. If you file for bankruptcy, you might be able to reclaim certain property that has been repossessed, such as your car, electronics or jewelry. If it has been fewer than 90 days since you filed for bankruptcy, it is possible for you to get repossessed property back. Speak to a lawyer who will be able to help you file the necessary paperwork.
The two main kinds of bankruptcy are Chapter 7 and Chapter 13. Make sure you understand them so you know what is best for you. If you file using Chapter 7 bankruptcy, you will get all your debts eliminated. Your ties with all creditors will get dissolved. If you file using chapter 13 bankruptcy, you will go through a sixty month repayment plan prior to all your debts being completely dissolved. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
Since the majority of attorneys are willing to provide no-cost initial consultations, it is smart to meet with more than one before you make a selection. By law, paralegals and assistants can not give legal advice, so be sure that you are meeting with an actual attorney. Take some time to talk to different lawyers to find one that fits your needs, and meshes well with you.
Always protect your house. You do not have to lose your home in the process of a bankruptcy. If your home has significantly depreciated in value or you’ve taken a second mortgage, it may be possible to retain possession of your home. You could also check out the homestead exemption. This lets you continue living in your house, depending on whether you meet certain financial requirements.
Chapter 13
Chapter 13 bankruptcy might be a good option, so don’t overlook it. If you have less than a quarter of a million dollars in debt that is unsecured and a regular income, you are eligible to file a Chapter 13. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. Expect to make payments for up to 5 years before your unsecured debts are discharged. However, if you are unable to properly commit to the plan you agree to, your case can be dismissed.
Be certain you are totally aware of the laws of bankruptcy before you file. There are many pitfalls you can easily fall into, such as transferring away assets to prevent them from being included in the filing. It is also illegal for someone who files for bankruptcy to drastically increase their debts on credit cards immediately before filing.
Whenever you file a petition for bankruptcy, do not leave out any information about your finances or assets. Failing to disclose all of your financial information can cause your bankruptcy petition to be dismissed, or, at the very least, delayed. Add every summer, no matter how insignificant, to your documentation. This might take the form of odd jobs, extra cars and outstanding personal loans.
Before filing personal bankruptcy, consider other options. One option to consider is credit counseling. You can get assistance from non-profit companies. They can negotiate with each of your creditors to work out payments that you can afford, along with reduced interest rates. Payments are then made to the creditor via the counseling service.
Before you file bankruptcy, consider how you will pay off your debts. The laws regarding bankruptcy most often prevent you from paying back some creditors for up to 90 days before filing, and friends and family for up to one year. Before making important decisions in regards to your finances, be sure you understand the laws.
You don’t necessarily have to forfeit all your assets when you file for bankruptcy. Personal property is exempt from bankruptcy claims. This may be things like jewelry, clothing, furniture and electronics. While this varies based on the laws in your area, your particular circumstances and the kind of bankruptcy you choose to go with, it may be possible to keep big-ticket items like your automobile or even your residence.
As was stated earlier, the bankruptcy journey is one shared by many others. However, you are probably among the more informed, because you have learned valuable tips from this article. Use these tips to have a smooth bankruptcy.
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