The economy is terrible today. People carry more debt and find it harder to stay fully employed when the economy is this bad. Deep debts usually wind up in bankruptcy. This is not a pleasant situation. If you or someone you know is in jeopardy of going bankrupt, then read this article to figure out how to get out of this situation.
When people owe more than what can pay, they have the option of filing for bankruptcy. When you get into this situation yourself, your first step is to familiarize yourself with your local bankruptcy regulations. Every state has a separate law having to do with bankruptcy. For instance, some states protect you from losing your home in a bankruptcy, but others do not. Be aware of bankruptcy laws before filing your claim.
A key tip for those filing a personal bankruptcy petition is to always be completely honest in all documentation. Resisting the temptation to hide income or valuable assets from the bankruptcy trustee is a smart way to avoid potential complications, penalties, and the possibility of being barred from re-filing in the future.
When choosing a bankruptcy lawyer, your best option is to find someone who is recommended by someone you know versus someone who you find online or in the phone book. Don’t be taken in by some fly-by-night company that exists only to profit from the suffering of others. Check out any lawyer you are considering thoroughly before engaging him or her.
Ask for a free consultation with your bankruptcy attorney and ask questions about experience and education. The majority of lawyers offer their first consult at no cost, so ensure you meet with several to find one that you like. Therefore consult with different lawyers and get a feel for them, then decide which one suits your needs There is no need to feel rushed to decide to file after you talk with your bankruptcy lawyer. This will give you extra time to interview several attorneys.
Learn of new laws prior to deciding to file for bankruptcy. Bankruptcy law has changed substantially in recent years, and therefore you must understand how such changes may affect your situation. To stay up-to-date on these laws, check out your state’s government website.
Chapter 7
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. Chapter 7 eliminates all debts. All of your financial ties to the people you owe money to will disappear. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Before filing for bankruptcy ensure that the need is there. It may be that all you really need to do is consolidate some of your debts. It can be quite stressful to undergo the lengthy process of filing for personal bankruptcy. Having a bankruptcy on your record will hinder your ability to get credit in the future. You only want to file for bankruptcy after you have exhausted your other options for dealing with your debts.
If you are making more money than you owe, bankruptcy should not even be an option. It can seem like bankruptcy can be an easy way to avoid paying back your debts, however it leaves a serious mark in your credit report that can last between seven and ten years.
Personal Bankruptcy
Investigate other alternatives before resorting to bankruptcy. Some alternatives to filing for personal bankruptcy include debt repayment plans, interest rate reduction plans, and debt consolidation. Talk with the personal bankruptcy lawyer to find out more. Loan modification plans on home loans are a great example of this. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. Above all else, what creditors want is to get their money. Sometimes they would rather settle for a repayment plan instead of a debtor who is bankrupt.
Bankruptcy affects people from all walks of life. You can avoid bankruptcy even with no steady source of income. Hopefully, the information in this article has provided you with useful information that can help you stay out of bankruptcy. Put this advice to work for you starting today.
