It can be very hard to live with a personal bankruptcy filing. If you are in financial trouble, it’s easy to feel trapped and a little scared about your future. Yet even if your credit score is not good there are things you can do to still get the things you want, such as a car or home loan, read on to find out how.
Don’t use credit cards to pay your taxes if you’re going to file bankruptcy. In a lot of places, the debt cannot be discharged, and you may still owe money to the IRS. Bear this in mind; if the tax can be discharged, then the debt can be as well. There isn’t any reason to use a credit card to pay the tax bill since the bill can be discharged anyway.
Retirement Funds
When bankruptcy seem inevitable it is important not to use your retirement funds or emergency savings to pay creditors. Retirement funds should be avoided at all costs. Although it is quite normal to use some of your savings, ensure that you leave enough in your account for emergencies.
Don’t avoid telling your lawyer specific details with your case. It is wrong to assume that your lawyer will remember every word you ever utter! Do not hesitate to speak up; this is your hearing and your future is on the line.
Be warned that after your bankruptcy, you may stand out as a leper to credit institutions. You may be unable to get a simple credit card. If this is so, apply for a secured card or two. This will be a demonstration of the seriousness with which you view rebuilding your credit rating. Once you’ve built up a history of on-time payments, you may start getting unsecured credit again.
Stay up to date with any new bankruptcy filing laws. It can be tough to keep up with them on your own, and because they change often, a bankruptcy attorney can help you keep track for the sake of your filing process. If you are not sure about the current laws all you have to do is look into what laws have been passed.
Check into less drastic solutions prior to declaring bankruptcy. If you owe small amounts of money, you can join a counseling program or straighten your finances out by yourself. It is also possible to do your own debt negotiations; however, be sure to get everything in writing.
Take advantage of free consultations with lawyers and the ability to sift through and find the right one. Talk to the lawyer and not his assistant, who may not be legally able to help you. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
Make sure you know how to differentiate between Chapter 13 and Chapter 7. Research them online to see the positive and negative aspects of each one. Ask your bankruptcy lawyer to clarify anything you don’t understand before making a final decision about which type of bankruptcy to file.
Think about all the choices available to you when you file for bankruptcy. There are many other options including debt consolidation and making payment plans with your creditors. If foreclosure looms, think about getting your loan plan modified. Sometimes your lender will work with you to help pay off your debt by giving you a lower interest rate, forgiving late fees, or extending the time period of your loan. At the end of the day, creditors want to get paid, and sometimes a debt repayment plan is preferable to dealing with a bankrupt debtor.
Try your hardest to present a complete representation of your current financial situation. If you do not complete your financial profile your case could be delayed or dismissed. Make sure that you add very small sums, even if you believe that they aren’t important. That may include secondary jobs, any cars or trucks you want to be considered assets and any current loans.
Personal Bankruptcy
Gain all the knowledge of personal bankruptcy that you can. There are a lot of pitfalls in the personal bankruptcy code that could lead to issues with your case. Mistakes can also have your case dismissed. Take time to research things related to personal bankruptcy before you move forward. Doing this will make the process easier.
Realize that bankruptcy, ultimately, might be better for your credit than continuing to make late payments or miss payments on your debt. Bankruptcies can remain on your credit reports for 10 years, you can jump right into repairing your credit. One of the good things about bankruptcy is that you can start fresh.
If you feel that bankruptcy filing may be right for you, seek some legal advice first from a specialist lawyer. The complexities of the process of filing, court proceedings and other issues can best be handled by a competent lawyer. Your attorney will be able to answer any questions you may have and will fill out the appropriate forms to file bankruptcy.
With time, things will get better credit-wise for you, despite your having previously filed for bankruptcy. By becoming financially responsible post-bankruptcy, you’ll be showing lenders that you’re serious about reestablishing your credit worthiness. Save as much as you can and you will see the difference when you walk in for a new loan for a car or a home.
