In order to file a bankruptcy claim, you will run into more than a couple of complicated hurdles to jump. For example, there are several types of bankruptcies. Each type depends on several factors including your income as well as your debts. Therefore, it is essential that you learn about bankruptcy prior to petitioning the courts for bankruptcy protection. In the following paragraphs, you’ll find some tips that will get you off to a good start.
One of the best ways to learn more about the bankruptcy process is to hit the Internet and look up reputable bankruptcy websites. The United States Department of Justice, the American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys, all provide valuable information. The more you know, you can be confident you are choosing the right thing and that you are taking the right road to make sure your bankruptcy proceeds as easily as possible.
Don’t pay tax requirements with your credit cards with the thought of starting the bankruptcy process afterward, without doing your research first. In many areas of the country, this debt will not be dischargeable, and you could be left owing a significant amount to the IRS. Should the tax be dischargeable, the debt is often dischargeable as well. So, there’s no reason to make use of a credit cards if it will not be discharged in bankruptcy.
Always be honest and forthright when it comes to your bankruptcy petition. You must avoid the temptation to conceal any valuables, money or other assets from the courts. If they find that you have lied, you may be faced with fines, penalties or the inability to file in the future.
You are going to get found out and get in trouble if you don’t disclose all your assets, so be totally honest from the beginning. The lawyer representing you when you file needs to have full knowledge of your financial situation. Do not hold back anything, and form a sound plan to make peace with your reality.
Hire a lawyer if you plan on filing for bankruptcy. With all the ins and outs of bankruptcies, it can be hard to grasp all the knowledge. Personal bankruptcy attorneys can help make sure everything is done properly.
Chapter 7
Know the differences between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 bankruptcy completely wipes out your debt. Any debts that you owe to creditors will be wiped clean. Bankruptcy under the rules of Chapter 13, on the other hand, require you to work out a payment arrangement to pay back the agreed upon amounts. It is vital that you know the differences between these types of bankruptcies, in order to find the option that’s best for you.
Prior to choosing a bankruptcy attorney, seek a free consultation with at least three attorneys. Just be sure that the person you speak with really is the lawyer, rather than a paralegal, since they cannot legally give advice. Seeking out different attorneys is all part of the process until you find someone that you can trust.
If you filed for Chapter 13 bankruptcy, you can still get a mortgage or a car loan. This is harder. You have to meet with your trustee to get approval for the new loan. Create a budget and prove you can afford a new loan payment. 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.
Know your bankruptcy rights. Do not take debt collectors at their word when they tell you that a specific debt can’t be discharged through bankruptcy. There are only three main classes of debts that are non-dischargable: taxes, child support and student loans. If the bill collector is trying to deceive you, then report that company to your local attorney general’s office.
File when the time is right. Timing can be critical when it comes to personal bankruptcy cases. In certain situations, you should file right away, but other situations will warrant you waiting. Speak with a bankruptcy lawyer about when the best time is to file for your specific needs.
Try your hardest to present a complete representation of your current financial situation. Forgetting anything can cause a delay, or even a dismissal. All financial information needs to be considered by the court. This includes any jobs you have on the side, any vehicles you have and any outstanding loans.
Never take big cash advances from the credit cards that you own prior to filing for bankruptcy, even though you know that the debt will be erased. This fraudulent practice is a demonstration of bad faith. Debts you incur this way will likely not be discharged in a bankruptcy, and you will still have to repay them.
Don’t take too long when trying to decide whether you want to file bankruptcy. It’s hard to admit you need assistance, but the longer you decide to wait, the worse the debt can get. By consulting a professional, you will be able to get the advice that you need before everything gets too complicated.
Several of those who’ve already filed for bankruptcy vow that they won’t have a credit card ever again. That is not a great idea, because using credit builds better credit. You will not be able to get your credit back to a respectable score if you don’t use credit. Start with just one card in order to move your credit in the direction you want it to go.
Obviously you see the necessity for proper planning and decision-making in before you file. If bankruptcy is sensible option for you, a good and experienced bankruptcy attorney is a must have to help you begin the process of starting your financial situation anew.
