Think carefully before you decide to file for bankruptcy. Unless you realize every single little aspect of the proceedings to come, you might end up biting off more than you can chew. Apply the advice from this article to go down the right path. No matter which decision you make, knowledge is essential.
Once a person’s debts outstrip his or her ability to repay them, bankruptcy may be the only option left. If this is the case for you, you should begin to investigate the legislation in your state. You will find that each state has their own bankruptcy laws. In some areas, your residence may be completely exempt, but in others, it will not be. You should be familiar with the laws for your state before filing for bankruptcy.
Instead of jumping into a bankruptcy filing, be sure your situation requires it. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Since your credit history will forever note the bankruptcy, you want to make sure that you have tried everything else before you take an action such as this, in order to minimize the effect it will have with regard to your credit history.
Do not hesitate to remind your lawyer of any details regarding your case. You cannot expect your lawyer to remember every important detail without some reminder from you. Do not hesitate to speak up; this is your hearing and your future is on the line.
After a bankruptcy, you may still see problems getting any kind of unsecured credit. Since it is important that you work to rebuild your credit, you should instead think about applying for a secured card. When you do this, it shows your determination to fix your credit history. Eventually, you could be able to obtain unsecured credit.
Be honest when filing for bankruptcy. Don’t hide liabilities or assets, as they’ll come back and haunt you. It is important that you are completely transparent, showing everything financial that needs to be known. Bankruptcy can be a chance to simplify your finances, but any schemes you employ to conceal the truth can ruin that chance for you.
Before you file for personal bankruptcy, be sure that you are cognizant of all current laws. The laws change a lot, so you need to look them up and have a better idea of how to properly approach the bankruptcy process. To learn about any changes, search the Internet or contact your state’s legislative office.
There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice. Should you choose Chapter 7, your total debt load will be erased. With very few exceptions, the connections between you and your creditors will be severed. Chapter 13, on the other hand, involves a five year payment period before any remaining debts are cancelled. You need to determine which type of bankruptcy is right for you given your unique financial situation.
Most bankruptcy lawyers offer a free consultation, so meet with several before you decide on one. Ensure that your meeting is actually with the attorney, not with a paralegal or an assistant. People in these positions are unable to offer legal advice. Looking for an attorney will help you find a lawyer you feel good around.
Chapter 13
Consider filing using chapter 13 bankruptcy. With a regular income and unsecured debt below $250,000, Chapter 13 is probably best for you. This will allow you to keep your personal property and real estate and repay your debts via a debt consolidation plan. Expect to make payments for up to 5 years before your unsecured debts are discharged. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
Do not forget to make quality time for friends and family members. The process of bankruptcy can prove particularly brutal. It is often overwhelming, and not quick. Some people may feel embarrassed or feel their self-esteem has taken a beating from it. Avoidance of friends of family during the process is not uncommon. Washing yourself in self-pity will only make the situation worse and can leave you feeling very depressed. Make it a point to catch yourself if you feel yourself pulling away from others. Tell others that you would like to do some enjoyable things together while you go through bankruptcy process, then do it.
You can easily see that there are multiple ways to handle personal bankruptcy. Don’t be overwhelmed by the great wealth of information available to you. Take a few minutes to turn the information over in your mind and see how it might be useful to you. The more level-headed you can remain throughout this process, the better the choice will be that you make.
