If your debt has driven you to the brink of bankruptcy and you don’t know what to do, stop worrying. By simply searching online and doing a little research you can possibly avoid filing for bankruptcy. You may be able to avoid filing for personal bankruptcy by following the tips presented here.
Be certain to gain a thorough understanding of personal bankruptcy by using online resources. 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, the more you’ll knwo that you’ve made a wise decision and the you’re making sure your bankruptcy goes as smooth as possible.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. In most states, this is not dischargeable debt. Therefore, you will end up owing 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. This means using a credit card is not necessary, when it will just be discharged.
If bankruptcy is an option for you, secure the services of an attorney. It is difficult to make all of the necessary decisions yourself, and expert guidance will be helpful. When you engage the services of a bankruptcy lawyer, you can be assured of getting the help your need to proceed correctly.
Seek a less serious option prior to filing for bankruptcy. For example, there are credit counseling services that can help you to deal with smaller amounts of debt. It may also be possible to get lower payments, but if you do, be sure to obtain records for any consensual debt modifications.
If you are concerned about keeping your car, check with your attorney about lowering the monthly payment. Chapter 7 bankruptcy is one of the most common and effective. You need to have bought your car 910 days before you file, have a loan with high interest and you’re also going to need a good work history.
Financial Information
Every single piece of financial information you have needs to be studied and properly listed when filing a bankruptcy claim. If you do not complete your financial profile your case could be delayed or dismissed. All financial information needs to be considered by the court. Financial information should include all income, assets and loans.
When you file for bankruptcy remember that you are not going to lose all your assets. Many times you will be allowed to keep your personal property. This includes items, such as jewelry, clothes, household furnishings, electronics, etc. Depending on the state you are from, what kind of bankruptcy you’re filing, and your specific case, you could be allowed to keep bigger items, like your car or house.
Make a list of all your debts. Once you have an idea of who you owe and how much you owe, you can figure out if bankruptcy is really an option for you or not. Be certain to comb through your financial records to ensure the accuracy of the dollar amounts listed. Take care not to miss any debts that you need to disclose, or you will be responsible for paying them back after you have filed for bankruptcy.
After filing for bankruptcy, wait a couple of months and then access your credit reports via the three major agencies that handle credit report. Be sure these reports are accurate and correct in regards to all of your closed accounts. Resolve any problems immediately so you can build up your credit score as quickly as possible.
You do not need to halt your plans to file simply because you have changed jobs. Even with some extra cash, bankruptcy could still be your best bet. Filing alters your life dramatically. If you can file for bankruptcy before receiving additional income, this extra money won’t count against you.
Rethink a divorce when in a tough spot with finances. There are plenty of stories of people who got divorced, and then filed for bankruptcy right away because they now had less income and a ton of debt from their marriage. Reconsidering divorce can be a very smart option.
Chapter 13
If you realize that you do not qualify when it comes to the Homestead Exemption when you file for chapter 7 bankruptcy, then you might be able to use chapter 13 bankruptcy when it comes to your mortgage. There may be situations in which it makes more sense to convert a Chapter 7 case to a Chapter 13, but it is important to discuss such a strategy with your lawyer.
Remember that you have the option to file again if your bankruptcy filing gets dismissed due to an error on your part. Be aware, though, that in most situations you will only possess the assistance of an automatic stay for thirty days after filing if your case has already been dismissed once. It is possible to have the stay extended by making a showing that the error was excusable and that you should be permitted to file again.
If you are facing a looming tax debt, don’t think that bankruptcy can be your savior. It is not unheard of for individuals to pay their tax bill with their credit card and subsequently file for bankruptcy protection. The assumption they are working under is that all of their credit card debt will be treated equally, allowing them to get their tax payment discharged. However, bankruptcy laws forbid this, and you will be stuck with taxes owed as well as credit card interest.
Proper planning could place you in the proper place. Just try and buy yourself a little time and see if you can get your finances back in order. Just be sure that you’re making the right decisions in preventing from filing bankruptcy. Plan your future out now.
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