Bankruptcy is a decision that should be considered carefully before undertaking. Look through the suggestions this article has to offer so you understand the ideas you should be thinking about when it comes to filing for bankruptcy. Take the time to educate yourself before you make your choice.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. Bear this in mind; if the tax can be discharged, then the debt can be as well. So it does not help you to put the tax bill on your charge card if you know the debt will be discharged anyway.
When it comes to informing your attorney about your case, don’t be fearful. Don’t assume that he will remember something you told him weeks ago. All information submitted to the court with your signature needs to be double checked.
Unsecured Credit
It can be difficult to obtain unsecured credit once you have filed for bankruptcy. Since it is important that you work to rebuild your credit, you should instead think about applying for a secured card. Using a secured card not only helps to rebuild your credit, but it also keeps you from going more in debt with credit card bills. Then, in time, it may be possible for you to obtain an unsecured credit card.
Be completely honest whenever you file for personal bankruptcy. Hiding any asset or liability is a risk that will bite you in the end. The lawyer representing you when you file needs to have full knowledge of your financial situation. Telling the truth will allow you reach a solution that is feasible, given your current situation.
Bankruptcy is tricky and hiring a good lawyer will be a must. Bankruptcy can be highly confusing and stressful, and you need an unbiased partner who can help simplify the process. When you engage the services of a bankruptcy lawyer, you can be assured of getting the help your need to proceed correctly.
Chapter 13
Learn the differences between Chapter 7 and Chapter 13 bankruptcies. Should you choose Chapter 7, your total debt load will be erased. All of your financial ties to the people you owe money to will disappear. A Chapter 13 filing involves a repayment plan, though. Typically, you will make a partial payment against your debts over the next 60 months before the balance of the debts is lifted. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Safeguard your home. It isn’t inevitable that you will lose your house when you file for bankruptcy. For instance, if your home value has dropped recently, or even if you happen to hold a second mortgage, you may not necessarily lose the home. If this is not the case, find out more about Homestead Exemptions you might qualify for if you meet certain financial requirements.
While going through this process, spend more time with friends and family. Bankruptcy can take a toll on you. Having to declare bankruptcy leaves many people feeling like a failure. A lot of people become depressed and withdrawn until their bankruptcy is discharged. However, you will only feel worse about what has happened, which may lead you into depression. Remember that it is not your families fault for your financial hardships and use this time to pull together and be strong.
It is possible to get an auto loan or mortgage during the repayment period for Chapter 13 bankruptcy. This is harder. You must meet with a trustee to gain approval for a new loan. Draft a personal budget to show that you will be able to repay your new loan. You also need to be prepared to answer questions about your need for the new item.
Before filing for bankruptcy, you must be educated on the specifics of all bankruptcy laws. Here is one example, an individual who files for bankruptcy cannot transfer any assets for a year before the filing date. Also, it is illegal to load up your credit cards with debt right before filing occurs.
After reading the previous article, it is obvious that bankruptcy is not something that takes place on its own. Many things have to be done properly. By following the above advice, you will make fewer mistakes and find yourself better prepared.
