When you are drowning in debt, you may find yourself scared. It seems as if one little debt somehow ballooned into catastrophic debt. It’s unfortunate that once out of control, debt problems are very difficult to resolve. The following article will give you some pointers on what to do regarding bankruptcy if you are way over your head in debt.
Do not consider paying off tax debt with credit cards and filing for bankruptcy afterward. It won’t work. In a lot of places, the debt cannot be discharged, and you may still owe money to the IRS. In most cases, you can use the adage that “a dischargeable tax is a dischargeable debt.” If you live in an area where tax can be discharged through bankruptcy, financing your tax bill is pretty pointless.
Don’t be afraid to remind your lawyer about important aspects of your case. Don’t assume that they’ll remember something important later without having a reminder. This is your bankruptcy case, so do not be afraid to remind your lawyer of any key facts.
Before declaring bankruptcy, be sure you’ve weighed other options. One example would be that a consumer credit program for counseling if you have small debts. You may have luck negotiating lower payments by dealing directly with creditors, but be sure to document any get and new agreement terms in writing from each creditor.
Protect your home. You don’t have to lose your home just because you are filing for bankruptcy. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. You are still going to want to check into homestead exemption either way just in case.
Once you have completed the bankruptcy filing, you should take time to do something you enjoy. It’s easy to be stressed during this time. Don’t let the process control you in a negative way. You will get through it, and you should make an effort to remember that. Once the process is complete your life will improve.
If you filed for Chapter 13 bankruptcy, you can still get a mortgage or a car loan. It is just tougher. Your bankruptcy custodian will need to approve the loan. Create a budget and prove that you will be able to afford it. Also, you need to be ready to say why you’re going to need the item.
Debt Collectors
If you decide to file for bankruptcy, it’s important that you’re educated about your rights. Certain unscrupulous creditors will try to convince you that certain debts can’t be discharged in bankruptcy. There are a few debts that cannot be cleared, such as student loans and child support, but be sure to know the details when dealing with debt collectors. If you are speaking to debt collectors about another type of debt and they tell you it cannot be discharged, check your local regulations. You can report the collectors to your state attorney general if they are lying about this.
Before filing for bankruptcy, establish the fact firmly in your mind that you have nothing to be ashamed of. It is not uncommon for bankruptcies to elicit feelings of guilt, remorse and embarrassment. But, such emotions get you nowhere, and they can cause significant mental issues to emerge. Focusing on the positive during this stressful time is a good strategy for coping with your ordeal.
Filing for bankruptcy can cause stress. Make sure that you hire an experience lawyer to get your bankruptcy done properly. Get recommendations and look into other qualifications rather than just choosing based on cost alone. Choosing a lawyer should be based on finding one with a proven track record who can give you the help that you need. Talk to friends who have been through a similar situation and ask them for referrals. When looking at bankruptcy attorneys, consider sitting in on one of their court hearings to find out how they handle the case.
Do not put off filing for bankruptcy. The judge reviewing your petition will consider your recent behavior, purchases, income and payments when making a decision. If you have failed to make payments for several months but have continued making purchases on credit, your petition may be denied. When you make the connection that your debt level is too high, contact an attorney that specializes in bankruptcy as soon as possible, to see what can be done.
Sometimes, financial crises just take place in your life and you do not have the chance to do much about them. In this article, you were presented with some tips on regaining control of your money and debt. Use this information to make a fresh start!
