Is your debt piling up to the point that a bankruptcy seems like the only option? Don’t feel bad, you are in good company. Some people have turned to bankruptcy, as it is their only option for getting rid of a bad financial situation. The article below discusses some information and tips to help you make sense of bankruptcy.
After filing for bankruptcy, you could have trouble acquiring unsecured credit. Look into getting a secured credit card in order to get back on your feet with building credit. If you pay what you owe back promptly at all times, you can show that you are taking steps to be responsible about your payments and credit rating. In time, it may be possible for you to obtain unsecured cards.
Before pulling the trigger on bankruptcy, be sure that other solutions aren’t more appropriate for your case. For example, there are credit counseling services that can help you to deal with smaller amounts of debt. Some creditors will work with you to help you pay off your debt with lower interest rates, lower late fees, or an extended loan period.
Chapter 7
You may have heard bankruptcy referred to differently, either as Chapter 7 or Chapter 13. Learn the differences between the two before filing. Chapter 7 bankruptcy is intended to wipe out all outstanding debts. This type of bankruptcy ends any relationship you might have with creditors. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. You need to determine which type of bankruptcy is right for you given your unique financial situation.
Protect your house. There are many options available to help protect you from losing your home. Whether you get to keep your home depends on a few things, including its value and whether you have debts like a second mortgage or HELOC. There are other options such as a homestead exemption which offers you a chance to remain in your home, depending on whether or not you meed certain financial conditions.
Learn about teh differences between Chapter 13 and Chapter 7 bankruptcy. Take the time to find out about each one online, and look at the advantages and disadvantages of each. Once you have done your own research, be sure to review your findings with your lawyer, who is the expert. This way, you can be sure of making a well informed choice.
Don’t forget to enjoy your life once your finances get fixed. It can be several months between the initial filing and the final discharge of debts. You do not want to have to deal with depression in addition to your financial troubles, so you should take steps to keep yourself happy. Once your petition is in the hands of the judge, all you can do is wait.
Make sure you act at an appropriate time. Timing is very important when it comes to personal bankruptcy filings. Sometimes, filing as soon as you can is best, while other times, it is wise to get past the worst problems first. A lawyer is in the best position to evaluate your case and figure out when you should file for bankruptcy.
Do a little bit of research into the regulations having to do with filing for bankruptcy before you begin the process. When it comes to the code of personal bankruptcy, a large number of loopholes exist that could be troublesome. Not only could your case be dismissed, but it may also affect your ability to refile. Do as much research as possible about bankruptcy before you file. Doing this can make the process simpler.
If you are planning to file bankruptcy, avoid taking large cash advances from credit cards thinking that the debt will be erased. Doing so, is a type of fraud that may result in your having to pay back all money advanced from credit card accounts in the months just prior to your bankruptcy.
Do not pay off debts blindly before you file a personal bankruptcy. Bankruptcy laws prohibit some creditor payoffs within 90 days of filing. When it comes to family members, a year is the cutoff for payoffs. Do your research and figure out the laws for you.
Don’t put off handling the research or procedures for the bankruptcy process if that is the route you’re taking. It is absolutely difficult to admit you require help. On the other hand, the longer you delay, the more debt you rack up. If you are not sure, gather all of your information and spend a little time speaking with a bankruptcy attorney; their experience can help you make the right decision.
Make a prompt decision to accept more responsibility for your financial situation before you file. Don’t go on a spending spree or increase your debt right before you file. Creditors and judges look at your current and past financial history when they make a decision about your personal bankruptcy. You need to show the court that you have changed and are ready to act in a financially responsible manner.
Make wise decisions when choosing a lawyer. There are a disproportionate number of inexperienced lawyers working in the bankruptcy field. Often times, people choose lawyers that aren’t licensed properly or that don’t have enough experience. Don’t fall victim to this. If you want to check for a proper lawyer, you can use the Internet, ask your friends, or look for a popular lawyer via the Yellow Pages. The idea is that you want to ensure your lawyer’s competency on the issue.
As you know by now, many other people have had to file for bankruptcy before you. But since reading this article, you now have information that others don’t have. Use the above tips to make sure the bankruptcy process goes smoothly.
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