The economy is still weak today. People carry more debt and find it harder to stay fully employed when the economy is this bad. Debts can lead to bankruptcy, something that is very bad. If you or someone you know is in jeopardy of going bankrupt, then read this article to figure out how to get out of this situation.
Be certain you understand all you can about bankruptcy by researching reputable sites that offer good information. You can learn a lot on the U.S. D.O.J., the A.B.I and the N.A.C.B.A. are all useful organizations willing to provide educational material. Knowing is half the battle, after all, and these websites are the first step in learning what you need to know to make your bankruptcy smooth and stress-free.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. In some places the debt can not be discharged, and you may still need to pay the IRS afterward. In most cases, you can use the adage that “a dischargeable tax is a dischargeable debt.” So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
Credit History
Before you file for bankruptcy, carefully consider if it is the right option for you. Alternatives do exist, including 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.
Avoid exhausting your savings or emptying your retirement accounts to pay off creditors if you are considering filing for bankruptcy. You should not use your retirement savings unless the situation calls for it. Although it is quite normal to use some of your savings, ensure that you leave enough in your account for emergencies.
Be completely honest whenever you file for personal bankruptcy. Hiding any asset or liability is a risk that will bite you in the end. Whomever you plan to use should know a lot about the finances that you have, both the good and the bad. Do not leave anything out and come up with smart plan to manage the situation you are dealing with.
You should not have to pay for a consultation with a bankruptcy attorney. Make sure you ask lots of questions. The majority of lawyers offer their first consult at no cost, so ensure you meet with several to find one that you like. Only choose an attorney once all your concerns are answered to your satisfaction. Take your time choosing the right attorney to assist in your bankruptcy. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.
If you’re filing for bankruptcy soon, be sure you are going to hire a lawyer. Having a lawyer on your side is the best way to avoid mistakes and bad decisions. A qualified bankruptcy attorney can guide you through the filing process.
Familiarize yourself with any new law before you make the final step to filing for bankruptcy. If you want to file for bankruptcy successfully, it’s important to review the latest applicable laws. They tend to change frequently. Your state will have a website to check, or a number you can call, to learn the latest changes in the bankruptcy laws.
Before declaring bankruptcy, ensure that all other options have been considered. For example, if you only have a little bit of debt, you might be better off if you went through consumer credit counseling. It is sometimes possible to negotiate smaller payment by yourself. If you do this, make sure you save a written record of debt modifications that are negotiated.
Protect your home. You don’t have to lose your home just because you are filing for bankruptcy. Depending on if your home’s value has gone down or if it has a second mortgage, you might be able to keep it. You should also examine the possibility of taking a homestead exemption. This could apply if your income falls below the financial threshold.
Bankruptcy Laws
Make sure you know the bankruptcy laws before filing your petition. There are many traps in the bankruptcy laws that could trip up your case. Some mistakes can even lead to your case being dismissed. Spend some time learning about personal bankruptcy. Doing this will make the process easier.
Don’t spend too much time deciding whether or not you should file for bankruptcy. It can be difficult to ask for help, but as you wait, you accrue more debt. The time to seek out professional advice on bankruptcy is as early as possible. Your financial situation will get complex very quickly, so wise counsel is more valuable the earlier you get it.
The economy is showing signs of recovery, but unemployment and underemployment are still high. If you are unemployed, or lack a regular income, you can still take steps to avoid having to file for bankruptcy. Hopefully, you are now aware of how to get yourself or your loved ones on the right track in order to avoid bankruptcy. May good fortune be with you.
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