Many people are quite frightened when they think about bankruptcy. Between rising debt and pressure from the family, it can leave you sleepless at night. If you are in a situation that may require a bankruptcy filing, don’t let fear overcome you. Read this article and learn valuable tips and advice to make this scary situation much more manageable.
Before you file for bankruptcy, carefully consider if it is the right option for you. You have better options. For example, you could try credit counseling. Bankruptcy leaves a permanent mark on your credit history, so before you take such a large step, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
If you are faced with the choice of filing for bankruptcy or using your emergency fund or retirement accounts to pay creditors, opt to file for bankruptcy. Avoid ever touching retirement funds until you have no other choice. While you may have to use a part of your savings, never completely wipe it out which would only leave you in worse financial shape in the future.
Never shirk on the truth in your petition for bankruptcy. Don’t hide income or assets from your lawyer or the bankruptcy trustee or you may find yourself in legal trouble.
No matter what, don’t give up! If you file for bankruptcy at the right time it could enable you to get your property back that you lost to repossession. You should be able to get your possessions back if they have been taken away from you within 90 days before you filed for bankruptcy. Interview and research attorneys before choosing one to help you with your bankruptcy.
When you do meet with a lawyer make sure that they answer all of your questions and that they do not charge you for consultation alone. Most lawyers offer free consultations, so consult with a few before settling on one. Only choose a lawyer if you feel like your questions were answered. You don’t have to make your decision right after this consultation. After your consultations, do some additional research on each attorney you consider qualified for the job.
Many bankruptcy attorneys offer the first consultation with no charge, so consult with several before deciding on one. Be certain that the person you meet with is really a lawyer. Avoid meeting with paralegals or legal assistants because they cannot give you legal advice. Look for an attorney until you find one you feel comfortable with.
Before declaring bankruptcy, see if there’s anything less drastic you can do to repair your credit. There are many other options including debt consolidation and making payment plans with your creditors. If you are about to lose your house, talk to your lender about a loan modification. The lender may be willing to reduce interest rates, eliminate late charges or extend the life of the loan. Creditors want to recoup the most money possible from debtors, and they can often get more through debt repayment plans than bankruptcy procedures.
You can still take out a car loan or mortgage while you are in Chapter 13 bankruptcy. However, it won’t be as easy as it may have been to get one prior to the bankruptcy. Normally, the trustee assigned to your bankruptcy must approve any new loan. When meeting with the trustee, bring a budget which shows that you will be able to afford the payment on the loan you are trying to get. The odds are also good that you will be asked exactly why you’re purchasing a new item. Make sure you have a good reason.
Don’t wait till it’s too late to file for bankruptcy. It is all too common for people to hope that their financial difficulties will disappear if they don’t give them any attention. It doesn’t take long for debt to become unmanageable, and not taking care of it could eventually lead to wage garnishment or foreclosure. As soon as you know that you are too far over your head, make the move to call an attorney skilled in bankruptcy court, to weigh your options.
Take a look at all of your financial options before filing for personal bankruptcy. For example, you may want to think about credit counseling. May non-profit companies are available to help you. These organizations can work with creditors to lower your payments and interest rates. All you have to do is give them your payments and they handle paying the creditors.
Before you file for personal bankruptcy, take great care in paying off your debts. There are bankruptcy laws which forbid repayment of some creditors within three months before filing. In the case of family members, this period of time may extend to a full year. Know the rules before you jump in feet first.
Don’t spend too much time deciding whether or not you should file for bankruptcy. Yes, it may be hard to admit the need for help, however, if you try to stall from getting help your situation can only worsen. Take responsibility to talk with a bankruptcy expert sooner, rather than later. The longer you wait, the more difficult the situation can become.
It’s normal for people to be scared of bankruptcy, since it really is a frightening process. You might have been worried about it before, but this article can put those fears to rest. Apply what you’ve learned here, and get a fresh start for you and your family.
