Bankruptcy is both a stressor and a relief. On one side, you will need to handle a lot of people looking into your personal finances. Bankruptcy has a positive outcome since the collection calls will stop. Take a look ahead to figure out more about bankruptcy.
When you feel certain that you must file for personal bankruptcy, refrain from squandering your life savings to pay off unsecured debt. Retirement funds should be avoided at all costs. You may need to tap your savings, but don’t empty your savings account, as this could leave you in a difficult situation down the road.
Once the bankruptcy is complete, you may find it difficult to receive unsecured credit. If you find yourself in this situation, you may want to think about getting a secured card or two. This will be a demonstration of the seriousness with which you view rebuilding your credit rating. After a certain time, you will then be able to acquire credit cards that are unsecured.
If you are planning to file for bankruptcy, be sure to learn what types of assets you will be able to keep and which can be seized. Certain assets, as listed in the local bankruptcy regulations, are immune from seizure during bankruptcy. It is important that you read this list before filing for bankruptcy, so that can find out whether or not your most prized possessions will be seized. You wouldn’t want to unexpectedly lose any possessions you treasure.
Familiarize yourself with the bankruptcy code before you file. Laws are subject to change, and it’s important that you’re educating yourself about current code only. All of these changes will be addressed on the state’s legislative site. You can also contact them directly by phone or office visit.
Take the time to find a simpler solution to your financial issues, before filing for bankruptcy. For example, consumer credit counseling services can often help you figure out a workable repayment plan with creditors. Also, you could try to get your payments lowered on your own. If you decide to do this, get a copy of anything you agree to.
Protect your house. Filing for bankruptcy does not always mean you will end up losing your home. Check your home’s current value to see if it has gained equity and get your first and second mortgage papers together. You can also investigate your state’s homestead exemption, an option that might enable you to keep your home if certain financial requirements are met.
Chapter 13 Bankruptcy
Look into filing Chapter 13 bankruptcy. Chapter 13 bankruptcy is a good choice for people whose unsecured debts amount to lower than $250,000 and who receive a regular income. You can secure your home under Chapter 13 and pay your debts with a payment plan. This repayment period usually lasts from three to five years. If you make your payments faithfully during that time, any remaining unsecured debt will be eliminated. Stay mindful that should you for any reason miss even one plan payment, your whole case is going to get thrown out by the court system.
If you are concerned about keeping your car, check with your attorney about lowering the monthly payment. Chapter 7 usually can help payments be lowered. If you meet the criteria specific to your state, it may be a good option to consider.
When you do file for bankruptcy, make sure you know your rights. Don’t take a debt collectors word for it simply because they tell you that you can’t have many or all of your debts erased by bankruptcy. Most loans can be discharged outside of certain things, like child support or loans you are paying back due to student lending. 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.
Pick the right time to file. They say timing is everything, and this rings true when filing for bankruptcy. Sometimes it is the best option to file quickly, whereas in other situations filing should be put off until the worst has already passed. Speak with a bankruptcy lawyer about when the best time is to file for your specific needs.
Banish the word “shame” from your vocabulary before you file for bankruptcy. It is not uncommon for bankruptcies to elicit feelings of guilt, remorse and embarrassment. Wallowing in these emotions benefits no one, and only serve to harm your own mental health. Keeping an optimistic view as you deal with your financial woes is the most productive way of dealing with a bankruptcy.
There are good things as well as bad, in regards to filing for bankruptcy. Whatever your reason for doing it, keep in mind that information is the strongest ally you have throughout the entire process. The tips laid out here will help you cope with bankruptcy in an easier manner. Use these tips smartly to make the best decision possible.
