With the state of the economy, job market, and stock market, bankruptcy has become more and more common. You can thank the dismal economy for that. In order to get through the process safely and with a minimum of fuss, you are going to want to thoroughly educate yourself on bankruptcy before you try to file for it. Read this article to learn more about bankruptcy.
When you realize that you probably will file for bankruptcy, do not pay your creditors or try to avoid bankruptcy by spending all of your regular or retirement savings. Retirement accounts should never be touched if it can be helped. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
Honesty is of utmost importance during your filing, even though it may be tempting to “pad” your answers a little. To avoid problems, penalties and future re-filing bans, resist the urge to hide documentation or assets.
Be honest when filing for bankruptcy. Don’t hide liabilities or assets, as they’ll come back and haunt you. Penalties may include fines, imprisonment or denial of the filing. Do not hold back anything, and form a sound plan to make peace with your reality.
Don’t pay for an attorney consultation and ask him or her anything you want to know. The majority of lawyers offer their first consult at no cost, so ensure you meet with several to find one that you like. Do not make any final decisions until every question you have has been answered. You need not decide right away. This offers you the opportunity to speak with other attorneys.
Chapter 13
Make sure that you understand the difference between Chapter 13 bankruptcy and Chapter 7 bankruptcy. All debt will be eliminated with Chapter 7. Any ties you have concerning creditors will definitely be dissolved. But, with Chapter 13, you will be in repayment plan for about 5 years prior to any debts you have being totally dissolved. It is worth while to take your time to research both types of bankruptcy to decide which option works best for you, and your financial situation.
Become knowledgeable in regards to details about chapter seven bankruptcy vs. chapter 13 bankruptcy. Go to a reputable website and research the benefits and detriments of each type of bankruptcy. If you are confused by what you find, be sure to ask your attorney to explain anything that is unclear before you make your decision about filing.
It is imperative that you know for sure that bankruptcy is the option you need. You may find consolidating your debt may be simpler. Bankruptcy cases are long, anxiety-filled experiences. Your credit will be impacted for many years. You only want to file for bankruptcy after you have exhausted your other options for dealing with your debts.
Chapter 7 Bankruptcy
Take into consideration all the ramifications of a Chapter 7 bankruptcy. Filing for this can impact any co-debtors, such as friends or family. Once you file for Chapter 7 bankruptcy protection, you no longer have legal responsibility for debts that you and any co-signers originally agreed to. This does not dissolve any co-signers of the debt, and your creditors will continue to try and collect from them.
File for bankruptcy before your finances get completely out of control. Some people will just ignore their outstanding debts, hoping that someone or something will come and save them, but this never ends well. It doesn’t take long for debt to become unmanageable, and not taking care of it could eventually lead to wage garnishment or foreclosure. Once you are aware that your financial situation is not manageable any more, your best bet is to speak with a bankruptcy attorney and find out what he or she recommends.
Before you decide to file, make yourself aware of the laws about bankruptcy. For instance, somebody cannot transfer assets from a filer’s name up to a year after they file. Also, the filer can not increase their debt before filing.
Think before you pay debts after you’ve decided to file. Bankruptcy laws generally don’t cover situations which occurred within a short time frame prior to filing, such as the previous 90 days worth of credit card debt. Study applicable regulations prior to making any financial choices.
Do not take too long deciding that it is time to declare bankruptcy. It might seem a little scary, but if you wait forever to act, you’ll just be waiting that much longer once you do ultimately file. Talk to a lawyer as soon as you can to get the advice that you need.
Credit Rating
Many people who have filed for bankruptcy, resolve to never use credit or credit cards again. However, this is not a good idea because it is desirable to heal your credit rating. If you don’t ever use credit, your credit history will not improve, and you may not be able to purchase important things like a home and car. One credit card is adequate to begin rebuilding your credit rating.
As you read at the start of this article, bankruptcy has become a very common process now due to the economy. Use the tips you just read to make good decisions and remain in control of your financial situation.
This is a limited-time offer. We are not able to guarantee availability if you wait!
