Whatever leads you to bankruptcy is a sad tale, but that need not mean that’s the only story to tell for the rest of your life. The main purpose is to give yourself a fresh, new start in life. Continue ahead to learn how you can smooth out the bankruptcy process so it’s not a financial disaster.
When you feel certain that you must file for personal bankruptcy, refrain from squandering your life savings to pay off unsecured debt. You should never touch your retirement accounts, unless you have absolutely no choice. Of course you will have to touch some of your savings to get through all of the hearings, but do not put out any money that you do not have to by law.
Always be honest and forthright when it comes to your bankruptcy petition. Withholding or lying about certain information can seriously worsen your financial situation. It could lead to being unable to file for bankruptcy or even legal trouble.
Keep with what you have decided to do. When you file for personal bankruptcy, you may even be able to retrieve personal property that has been repossessed. For example you may be able to get your car, electronics and even jewelry returned to you. You should be able to get your possessions back if they have been taken away from you within 90 days before you filed for bankruptcy. Speak with a lawyer that will provide you with guidance for the entire thing.
You should never pay for your first consultation with a bankruptcy attorney. Make the most of this free consultation by asking lots of questions. It is a good idea to consult several attorney before deciding on one. Make your decision after all of your questions have been answered. You don’t have to make your decision right after this consultation. So you have sufficient time to speak with a number of lawyers.
Protect your house. It isn’t inevitable that you will lose your house when you file for bankruptcy. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. Another option is the homestead exemption that has certain income and financial requirements, but may also allow you to keep your home.
Don’t automatically assume that bankruptcy is your only option. There are many recouses available to help you lower your payments and get back on track. If foreclosure is imminent, see if your loan can be altered at all through a modification plan. The lender may be willing to reduce interest rates, eliminate late charges or extend the life of the loan. When all is said and done the creditors just want their money, and more often than not will work with you on a repayment plan.
If your vehicle is in question, perhaps your attorney can assist in lowering your payments. Chapter 7 usually can help payments be lowered. There are qualifications, such as the loan being high interest and a good work record for this option.
Chapter 7
Think about any co-debtors you have prior to filing for Chapter 7 bankruptcy. You may have your responsibility for your portion of the loan discharged under Chapter 7. However, the creditors could come after your co-signer and demand full payment for the debt.
Rest assured, when you file for Chapter 13 bankruptcy, you still have the ability to take out mortgage and car loans. This is a lot harder. You have to meet with your trustee to get approval for the new loan. When meeting with the trustee, bring a budget which shows that you will be able to afford the payment on the loan you are trying to get. Also, be sure you have a clear explanation as to why the item you are purchasing is absolutely necessary.
Before declaring bankruptcy, it is important to know your rights. You might hear from your creditors that your debts cannot be canceled through bankruptcy. Most loans can be discharged outside of certain things, like child support or loans you are paying back due to student lending. If a collector tells you your debt won’t be discharged in your bankruptcy and you know that it will, report the collector to the attorney general’s office in your state.
Again, it is likely that whatever precipitated a bankruptcy filing was not something on which you look back fondly. Life after bankruptcy can be normal and happy. Bankruptcy is not the end. Follow the tips given here in order to make it a new beginning.
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