It’s scary to have a ton of debt hanging over your head. Sometimes it happens quite quickly, from some financial problems to losing all control in a matter of weeks or months. Unfortunately, it is not simple to fix. The tips in this article will help you know what should be done if you find yourself contemplating bankruptcy.
Be certain you are making the right choice before you file for bankruptcy. There are plenty of other options open to you, like consumer credit counseling. Since your credit history will forever note the bankruptcy, you want to make sure that you have tried everything else before you take an action such as this, in order to minimize the effect it will have with regard to your credit history.
After filing for bankruptcy, you could have trouble acquiring unsecured credit. If you are in this situation, applying for a secured card may be the answer. This will show people that you are serious about getting your credit record back in order. Then, in time, it may be possible for you to obtain an unsecured credit card.
Don’t file for bankruptcy until you know what assets of yours can and can’t be seized. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. Prior to filing for bankruptcy, it is critical that you go over this list, so that you know if you can expect any of your most valuable possessions to be seized. If you don’t read this list, there is a chance that you might get nasty surprises when they take your things away.
Be completely honest whenever you file for personal bankruptcy. Hiding any asset or liability is a risk that will bite you in the end. When you file make sure whoever is handling the process is fully aware of each and every financial detail. Divulge all of your information so that you and your lawyer can devise the best strategy for dealing with your situation.
Learn about teh differences between Chapter 13 and Chapter 7 bankruptcy. By researching each type, you can begin to understand which method is right for you. If anything you see is unclear or doesn’t make sense, go over it again with your attorney before making the final filing decision.
Chapter 13 Bankruptcy
Consider filing using chapter 13 bankruptcy. You are eligible to file Chapter 13 bankruptcy if your income is reliable and your unsecured debt does not exceed $250,000. This will allow you to keep your personal property and real estate and repay your debts via a debt consolidation plan. That plan lasts approximately three to five years, and then you are discharged from unsecured debt. Missing a payment under these plans can result in total dismissal by the courts.
Never forget that you still deserve to enjoy life while you go through the bankruptcy process. Filing for personal bankruptcy can be very stressful for the debtor. Depression and burn-out from pent of stress will do nothing to help your situation, so it is critical to let go a little. Life is going to get better once you get through this.
Keep in mind that filing for Chapter 7 bankruptcy may affect other people than just you, including family members, and in some cases, business associates. A Chapter 7 bankruptcy will relieve you of your legal responsibility to pay any joint debts. However, if you had a co-debtor, they will be required to pay the debt.
File when the time is right. Timing is important, and that is especially true when filing for bankruptcy. Sometimes, you may need to file quickly; however, at other times, you should wait until the worst is over. Speak with a bankruptcy lawyer to see when is the best time for you to file bankruptcy.
If you are forced to file for bankruptcy, you should avoid being ashamed of yourself. Filing for bankruptcy leads people to feel all sorts of emotions like shame, guilt and feeling irresponsible. But, there is nothing positive about feeling this way and it can actually affect your mental state. Keeping an optimistic view as you deal with your financial woes is the most productive way of dealing with a bankruptcy.
Do not put off filing for bankruptcy. It is a big mistake to avoid financial problems, thinking they may go away on their own. Debts can get out of control fast. If you’re not taking care of these debts, you may be getting into trouble like wage garnishment. As soon as you stop denying that your debt is unmanageable, seek the advice of a good bankruptcy attorney.
Before you file, make sure you understand the laws as much as possible. For instance, you are not allowed to move assets from your name to someone else’s for a year before you file. Also, a person cannot legally increase their debt amount on credit cards prior to filing.
Every single piece of financial information you have needs to be studied and properly listed when filing a bankruptcy claim. Omissions or errors may cause your case to take more time to resolve, or even be rejected entirely. It is better to have something on there that you are unsure about, rather than not include it at all and risk a dismissal. This type of income could come from doing odd jobs, extra cars or outstanding loans.
Before you make the final decision to file bankruptcy, consider the other options you have. Credit counseling is an important option for you to pursue. There are some good non-profit organizations that could help you. These companies lower your interest and payments by working with your creditors. You’ll make your payments to the company, and the company will pay off your creditors.
Sometimes, financial crises just take place in your life and you do not have the chance to do much about them. Use what you learned from this article to regain control of your financial situation. Apply the advice from this article and you will be on your way to realizing financial freedom.
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