Just the thought of bankruptcy creeping up on you, can make you fearful to say the least. Between rising debt and pressure from the family, it can leave you sleepless at night. If you’re frightened by bankruptcy, or are living with its effects, you’ll find helpful advice in the following paragraphs.
Most people that file for bankruptcy owe a lot of money that they could not pay off. If you have unmanageable debt, you need to familiarize yourself with regional bankruptcy laws. Different states have different laws regarding bankruptcy. For instance, some states protect you from losing your home in a bankruptcy, but others do not. Do you research about legal ins and outs in your state before you begin the bankruptcy process.
Ask yourself if filing for bankruptcy is the right thing to do. You can also avail yourself of other options, such as consumer credit counseling. Bankruptcy stays on your credit for a whole decade, so if there are less drastic options that will solve your credit problems, it is in your best interest to make use of them.
When you realize that you probably will file for bankruptcy, do not pay your creditors or try to avoid bankruptcy by spending all of your regular or retirement savings. Don’t touch retirement accounts unless you don’t have a choice. You may have withdraw from your savings every now and then, but try to leave yourself some financial security for the future.
After filing for bankruptcy, you may have difficulty getting approved for unsecured credit. If so, apply for a secured credit card. This will demonstrate that you’re seriously trying to restore your credit. After a certain time, you will then be able to acquire credit cards that are unsecured.
Do some research to find out which assets you could lose by filing for personal bankruptcy. The Bankruptcy Code contains a list of various assets that are excluded from bankruptcy. It is important to be aware of this list so you will know what assets are saved. You wouldn’t want to unexpectedly lose any possessions you treasure.
Before pulling the trigger on bankruptcy, be sure that other solutions aren’t more appropriate for your case. There are numerous programs out there that may assist you with your debt, like a credit counseling program, a nonprofit group, government assistance, etc. Some creditors will work with you to help you pay off your debt with lower interest rates, lower late fees, or an extended loan period.
It’s a good idea to meet with a number of bankruptcy lawyers before settling upon one. The majority of them offer free initial consultations. Make sure you meet with a licensed attorney rather than a paralegal or assistant, because it is illegal for these people to give legal advice. Taking the time to compare lawyers will ensure that you get a person that you can be yourself around.
Reducing Interest Rates
Look at all the alternatives to bankruptcy before filing. A lawyer that specializes in bankruptcy law can help advise you of other options, such as repayment plans and reducing interest rates to relieve some of the burden. Loan modification plans can help if you are dealing with foreclosure. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Know your bankruptcy rights. It is not unusual for creditors to claim that their debt is not able to be discharged. What you can’t file on is very small, like student loans or child support payments. If these are not the categories in which your debts fall, double check to see if the type of debt can be bankrupted. If it can, be sure to file a complaint about the debt collector with the office of the state attorney general.
File when the time is right. When filing for personal bankruptcy, it is very important that you act at the correct time. Sometimes you may want to wait to file and in other situations you may find it better to do it as soon as you can. Speak with bankruptcy attorneys for a time frame for filing with your situation.
If you feel that bankruptcy filing may be right for you, seek some legal advice first from a specialist lawyer. Skilled lawyers have the ability to counsel you on whether you ought to file for bankruptcy and can also handle court appearances. Your lawyer will take care of the paperwork and help you understand what this process means for you.
People who say that bankruptcy is a scary experience aren’t exaggerating. Don’t let your fear take over. You now have the knowledge necessary to overcome the fear. Make the most of these tips quickly. This will allow you to get back to a normal life with your loved ones.
