Filing for bankruptcy is a serious decision that should be considered throughly. It is essential for you to understand all the details involved when you file for bankruptcy. Use the tips in this article to guide you in the right direction. Research can surely help you even though you have tough decisions coming your way.
Most people end up filing for personal bankruptcy because they owe more than they make. If this sounds like you, start familiarizing yourself with your state laws. There are greatly varying laws concerning bankruptcy, so it is important to make sure you are getting the correct information. In a few states, they see to it that your house is protected. This is not the case when it comes to other states. Do not file before learning about the bankruptcy laws in your state.
Credit Card
Don’t use a credit card to pay off your taxes before filing for bankruptcy. In most states, this debt won’t be discharged, and you could end up owing the IRS a whole lot more. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. So using your credit card to pay off your tax obligations, then filing for bankruptcy, can actually hurt you instead of help you.
It is important to remind your lawyer of any details that may be important to your case. Lawyers are people too, and sometimes they forget important information and need to be reminded. Do not hesitate to speak up; this is your hearing and your future is on the line.
Try to find a bankruptcy attorney who is personally recommended, rather than off the Internet, or out of the yellow pages. There are a number of companies who may take advantage of your situation, so always work with someone that is trustworthy.
Do not give up. Certain property cannot be repossessed while you are in the process of filing for bankruptcy so be sure to learn about the laws in your state. Any property repossessed within 90 days before filing bankruptcy, may be able to be returned to you. A lawyer will be able to assist you with filing the paperwork to get the items back.
Seek a less serious option prior to filing for bankruptcy. For example, you may want to consider a credit counseling plan if you have small debts. You may have the ability to negotiate much lower payments, just be sure any debt modifications you agree to are written and that you have a copy.
Learn and gain a firm grasp of the differences in applying for Chapter 7 bankruptcies versus Chapter 13 bankruptcies. Investigate the benefits and pitfalls of both. Online resources may be able to provide all the information you need. If the information you read is unclear to you, take the time to go over the specifics with your lawyer before making a decision on which type you will want to file.
Chapter 13 Bankruptcy
Consider filing using chapter 13 bankruptcy. If your source of income is regular and your unsecured debt is less than a quarter million, Chapter 13 bankruptcy is something you are able to file for. That way, you can hold onto your personal assets and pay back a portion of your debts pursuant to an approved plan. The length of the plan is generally up to five years, and when this is over, you will be free of unsecured debt. Remember that if you even miss one payment that’s due under this plan, the court could dismiss the whole case.
If you are making more money than you owe, bankruptcy should not even be an option. It can seem like bankruptcy can be an easy way to avoid paying back your debts, however it leaves a serious mark in your credit report that can last between seven and ten years.
Take some time after filing for bankruptcy to enjoy life. Many debtors stress-out during the time of filing. If you let the stress get to you you may get depressed if you’re not doing the proper things to fight it. You are getting a fresh start, and things will get better.
It does not take much experience with bankruptcy to understand that the entire process can be extremely stressful. Be certain that you hire a competent lawyer to minimize the stress and anxiety you are under. Do not let price be the only factor. Think about quality rather than cost when hiring an attorney. When deciding on an attorney get referrals, contact your better business bureau or get a free consultation from at least three attorneys. You could even attend a court hearing to see how an attorney handles his case.
As you are aware from the preceding paragraphs, you have many options to pursue personal bankruptcy with. Do not let the wealth of information become overwhelming. Take time to think about what you have read here. Then you will be prepared to make informed decisions about bankruptcy and your financial future.
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