The decision to file for bankruptcy is very serious and should not be taken lightly. If you take a few moments to check out the different tips and tactics listed in the text below, you can begin to realize how to navigate your way through the tough mine field that is bankruptcy. Find out all the information you can before filing for bankruptcy.
Do not consider paying off tax debt with credit cards and filing for bankruptcy afterward. It won’t work. Generally speaking, taxes are not a dischargeable debt. The delays caused by this sort of tactic could leave you owing the IRS a great deal in interest and penalties. A common rule is that dischargeable tax means dischargeable debt. Therefore, you have no reason for use of a credit card, if the amount is to be discharged in due process of the bankruptcy.
When it soaks in that filing for personal bankruptcy, don’t use all of your retirement funds, or all of your savings to resolve insolvency or pay creditors. Retirement accounts should never be touched if it can be helped. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
Before you file for bankruptcy, find out which of your assets will be exempt from seizure. The Bankruptcy Code provides a listing of the various asset types that are not included in the bankruptcy process. Prior to filing for bankruptcy, it is critical that you go over this list, so that you know if you can expect any of your most valuable possessions to be seized. If you are not aware of the rules, you could be setting yourself up for a lot of stress when your most important possessions are taken in the bankruptcy.
Be persistent in researching information about filing for bankruptcy and consult a qualified personal bankruptcy attorney. There may still be way to get repossessed items back after you file for bankruptcy. Any property repossessed within 90 days before filing bankruptcy, may be able to be returned to you. A lawyer will be able to assist you with filing the paperwork to get the items back.
Before you file for personal bankruptcy, be sure that you are cognizant of all current laws. Laws are ever-evolving. You must stay current with bankruptcy laws if you want to be successful in your challenge. To learn about these changes, try contacting your state’s legislation office or checking their website.
Chapter 7
There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice. If Chapter 7 is what you file, your debts will get eliminated entirely. All happenings with creditors will disappear. In a Chapter 13, though, you’ll be put on a payment plan for up to 60 months before being free of your debts. It is important that you understand the differences between the different types of bankruptcy, so that you can decide which option is best for you.
A free consultation is standard for bankruptcy attorneys, so shop around before settling on one. By law, paralegals and assistants can not give legal advice, so be sure that you are meeting with an actual attorney. Be sure to check out a number of lawyers so that you will find one who is just right for you.
It is in your best interest to be abreast of your rights in petitions for bankruptcy. Certain unscrupulous creditors will try to convince you that certain debts can’t be discharged in bankruptcy. Only a small number of debts are not dischargeable, including student loans and child support obligations. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Before filing personal bankruptcy, consider other options. You might want to look into the possibility of credit counseling instead. There are a number of companies that will assist you, many of which are non-profit. They can work with both you and your creditors to find a feasible way in which your debts can be paid off. You pay the organization, and they pay creditors for you.
Bankruptcy is not a chance happening in anyone’s life. When you file for bankruptcy, things must be done the right way. By using the tips in this article, you will be able to successfully file for bankruptcy and begin to rebuild your life.
