There are good and bad feelings associated with bankruptcy. On one hand, having people go through all of your personal financial information can be formidable. Though, once it is done and discharged, you can begin to rebuild without the pressure from creditors. Take a look ahead to figure out more about bankruptcy.
If you can, get a word-of-mouth referral for a lawyer. There are plenty of companies who know how to take advantage of people who seem desperate, and it’s important to be sure your bankruptcy can go smoothly; take your time and choose someone you can trust.
If you’re filing for bankruptcy soon, be sure you are going to hire a lawyer. Filing for bankruptcy is a complicated procedure, and you may not be aware of all the ins and outs. A personal bankruptcy lawyer will be able to help you and ensure you are doing things the proper way.
Learn the newest bankruptcy laws before filing. The laws are constantly undergoing changes, so you must stay on top of them if you are going to file for personal bankruptcy correctly. To know what these changes are, go to your state’s website or contact the legislative offices.
Unsecured Debt
Consider Chapter 13 bankruptcy. If you have a regular source of income and less than $250,000 in unsecured debt, you can file for Chapter 13 bankruptcy. That way, you can hold onto your personal assets and pay back a portion of your debts pursuant to an approved plan. This lasts for three to five years and after this, your unsecured debt will be discharged. However, if you were to miss a payment, the court would dismiss your case right away.
If you can afford to pay your bills, bankruptcy is not a wise option. While filing may seem simple and a way to get out of paying your debts, it does tremendous amounts of long-term harm to your credit report.
If concerned about keeping possessions like a car, find out if your attorney can reduce the payment. Sometimes, as part of the bankruptcy filing, your auto loan can be restructured so that you pay less each month. Your car must have been purchased more than 910 days prior to filing, be a high interest loan, and you must have had a steady work history for this to work.
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. When filing Chapter 7, you are not legally responsible for the debts in your name. This does not dissolve any co-signers of the debt, and your creditors will continue to try and collect from them.
Know the rights that you have as you file for bankruptcy. Occasionally, debt collectors will attempt to convince you that your debt isn’t eligible for bankruptcy. There are not many debts that can not be bankrupted, student loans and child support for example. If the bill collector is trying to deceive you, then report that company to your local attorney general’s office.
Make sure you are completely aware of bankruptcy laws before you consider filing. For instance, you may not be aware that a filer is forbidden from transferring assets from his or her name for one full year before the petition is filed. Also, you can’t go and max out your credit card just because you are about to file for bankruptcy.
Contrary to popular belief, you won’t necessarily lose your assets if you happen to file for bankruptcy. Personal belongings that fall under private property are something that you can keep. This will include things like clothes, jewelry and electronics. What you are allowed to keep depends on the laws of your state, the chapter under which you file for bankruptcy and how much money you owe to your creditors.
Filing bankruptcy will always have good and bad sides. Doing some research is the best way to choose the most adapted solution. The information you just read will greatly simplify the bankruptcy filing process. Use these tips to empower yourself before, during and after your bankruptcy.
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