Filing for bankruptcy will be a very crucial decision, so don’t take it lightly. Read the tips and suggestions in the following article so you know what to expect and just what you should be doing before you make that important decision. Learn as much as you can beforehand.
Lots of people have to claim bankruptcy when their bills are larger than their income. If this applies to you, be sure that you know what the laws of your state are. The laws governing bankruptcy vary from state to state. Your home is safe in some states, but in others it’s not. It is best to become familiar with your state’s laws regarding bankruptcy before you take the steps to file.
Personal Bankruptcy
Be sure everything is clear to you about personal bankruptcy via looking at websites on the subject. The United States Some valuable resources include the U.S. Dept of Justice and American Bankruptcy Institute. By having more knowledge, you can make the right decision, as well as be sure you are ensuring that your personal bankruptcy case goes smoothly.
Do not attempt to pay your taxes with your credit cards and subsequently file for bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. Generally speaking, debt incurred to pay taxes and the tax bills themselves are treated the same in a bankruptcy. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
If you can, get a word-of-mouth referral for a lawyer. To handle your bankruptcy, you need a trusted attorney, not a shady one that is out to take your money.
Do some research to find out which assets you could lose by filing for personal bankruptcy. The kinds of assets which may be exempted during bankruptcy proceedings are listed in the Bankruptcy Code. Be sure that you study this list. Make yourself aware of any assets you have that could be seized. This will ensure that you do not have any surprises once you have filed bankruptcy.
You must be absolutely honest when filing for personal bankruptcy. If you try to hide any of your information, it will eventually surface and cause you problems. Whoever provides your legal consultation must be privy to all of your financial information. Don’t withhold information, and create a smart way of coping with the reality of the situation.
Before declaring bankruptcy, ensure that all other options have been considered. For example, you may want to consider a credit counseling plan if you have small debts. Also, if you just contact your creditors and speak to them plainly and truthfully, the odds are good that you can negotiate a better payment structure that you can afford.
It is wise to meet with several lawyers before making a final decision, take advantage of the free consultations to find one that is a good fit for you. Always ensure that the person you meet with is a real lawyer, not a legal assistant or paralegal. These people can’t give legal advice. Interviewing multiple attorneys is a good way to find the best fit.
It is important to know how Chapter 7 filings differ from Chapter 13 filings. Spend time researching the advantages and disadvantages of filing for each one of these. Before making any decisions, discuss the information you have learned with your lawyer.
Prior to filing, it is important that you know all about bankruptcy laws. For example, it is against the law to transfer any assets from the filer to another for a year before filing. Maxing out your credit cards immediately before filing is also illegal.
Whenever you file a petition for bankruptcy, do not leave out any information about your finances or assets. If you leave off even one tiny detail, you may end up in some serious trouble, but at the least your claim will be denied. Make sure that you add very small sums, even if you believe that they aren’t important. Some things to be included are: current loans, valuable vehicles and side jobs.
Do not hesitate or stall when determining if filing for bankruptcy is the correct choice for your life and situation. It’s hard to admit you need assistance, but the longer you decide to wait, the worse the debt can get. If you talk to a financial professional, they can assess your situation and give you suggestions on what could solve the problem.
As this article has demonstrated, you do not have to go through bankruptcy. Many steps have to be taken, and all of them must be performed properly. By following the above advice, you will make fewer mistakes and find yourself better prepared.
