You might fear the IRS because they could seize assets, such as your car. Filing for bankruptcy can help ease your financial burdens and put an end to harassing phone calls from debt collectors. Continue reading for some useful tips to help guide you through this potentially stressful process.
It is essential when going through bankruptcy that all of your income and assets are reported openly and honestly. You might feel tempted to not declare certain assets in your bankruptcy in order to protect them from forfeiture, but if you’re found out, the process could take longer, or worse, you might be banned from filing for bankruptcy completely.
Be honest when filing for bankruptcy, because hiding liabilities or assets can only cause trouble to you. Whomever you use to file with must know everything there is to know about your finances, both good and bad. Don’t withhold information, and create a smart way of coping with the reality of the situation.
Seek a less serious option prior to filing for bankruptcy. For example, you want to look into credit counseling. This is the best option for small debts. Also, if you just contact your creditors and speak to them plainly and truthfully, the odds are good that you can negotiate a better payment structure that you can afford.
Investigate your other alternatives before you decide you have to go with bankruptcy. You may well be able to regain control over your debts by consolidating them. Going through a bankruptcy is a long and stressful process. Having a bankruptcy on your record will hinder your ability to get credit in the future. Thus, you must make certain that bankruptcy really is the only viable solution to your problems.
You should weigh every option before thinking about bankruptcy. There are many other options including debt consolidation and making payment plans with your creditors. If a foreclosure is on your horizon, look into loan modification plans. There are many ways in which a lender can make adjustments that will be helpful to you. Among them are extending the loan, forgiving late charges and reducing the interest rate. Many times creditors are happy to work with you to ensure that you will repay your loan.
Chapter 7
Before you decide to file for Chapter 7 bankruptcy, consider how it could affect other people on your credit accounts, such as family members or business partners. When filing Chapter 7, you are not longer liable for the debts that you and a co-debtor signed for. Creditors, however, will hold the co-signer liable for the entire balance of the debt.
Refrain from feeling shameful about your bankruptcy. Many people feel guilty, embarrassed and unworthy when dealing with bankruptcy. But, there is nothing positive about feeling this way and it can actually affect your mental state. Having the right outlook during a tough financial upheaval is a great attitude in coping with bankruptcy.
Go ahead and file for personal bankruptcy as soon as you realize it is necessary. Some people will just ignore their outstanding debts, hoping that someone or something will come and save them, but this never ends well. Debt can become a big problem rapidly, and if you fail to handle it, you can face foreclosure or garnishment of wages. As soon as you’ve decided that you no longer have a handle on your debts, consult a bankruptcy lawyer to see if bankruptcy is right for you.
Review bankruptcy rules before you file your petition. There are many traps in the bankruptcy laws that could trip up your case. It is even possible to make the sorts of errors that can cause your case to be dismissed. Spend some time learning about personal bankruptcy. Doing this will make the process easier.
Under no circumstances should you take out a huge cash advance on any of your open credit cards before filing for bankruptcy. This is fraud, and even if your other debts are discharged, you will have to pay the money back.
Make sure to include all of the debts that you want eliminated on your bankruptcy filing papers. Debts that you neglect to include in your paperwork won’t be discharged. It is imperative that you take responsibility to let the court know about all debts by the deadline they give you.
Getting Divorced
If you’re thinking of getting divorced, evaluate the financial consequences of doing so. Many people find they need to claim bankruptcy after divorce because they did not see the financial problems that were ahead of them. A great way to avoid this is by not getting divorced.
Filing for personal bankruptcy is an option, but use it as a last resort after exploring all of your other options. Keep in mind that a number of debt consolidation services aren’t legit, and will only worsen your debt. Keep the advice you read in mind so that you’re able to make smart choices and stay out of debt in the future.
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