Deciding to file for bankruptcy is not an easy decision to make; but, in some cases, it is necessary. It’s best to make the decision of filing for personal bankruptcy after doing a little research and gaining a clear understanding of the topic. This article contains wisdom and knowledge to help you fully understand the bankruptcy process.
Do not use your retirement fund or savings to pay off creditors. Leave your retirement accounts untouched unless there is absolutely no other alternative. While you may have to use a part of your savings, never completely wipe it out which would only leave you in worse financial shape in the future.
Before you decide to file bankruptcy proceedings, determine which assets will be safe. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. You can determine exactly which of your possessions are at risk by consulting this list before you file. You wouldn’t want to unexpectedly lose any possessions you treasure.
Make sure you are completely honest when filing for bankruptcy. Hiding your assets is never wise. The person you choose to file with needs to know both the good and bad aspects of your finances. You are in this situation, now help them to give you the best assistance possible to deal with it. You do that by giving full disclosure and holding nothing back.
Do some research about laws and legislation before filing. Laws are subject to change, and it’s important that you’re educating yourself about current code only. To learn about these changes, try contacting your state’s legislation office or checking their website.
Safeguard your home. You don’t have to lose your home just because you are filing for bankruptcy. You could keep your home; it depends on your home’s value or if a second mortgage is on your home. You are still going to want to check into homestead exemption either way just in case.
Investigate your other alternatives before you decide you have to go with bankruptcy. Maybe you can just consolidate debt to make it simpler to deal with. Filling for bankruptcy could be a long and stressful process. Your credit will be impacted for many years. Thus, you must make certain that bankruptcy really is the only viable solution to your problems.
Chapter 13 Bankruptcy
Consider Chapter 13 bankruptcy for your filing. If you have a regular source of income and less than $250,000 in unsecured debt, you can file for Chapter 13 bankruptcy. Filing a Chapter 13 will let you keep personal items and real estate while you pay down your debt in a consolidation plan. That plan lasts approximately three to five years, and then you are discharged from unsecured debt. Remember, though, that if you fail to make even one payment, the case will be thrown out and you’ll be right back where you started.
Don’t isolate yourself from family and friends. The bankruptcy process can be brutal. It is lengthy, stressful and often leaves people feeling ashamed, unworthy and guilty. Avoidance of friends of family during the process is not uncommon. On the other hand, isolation of a self-imposed nature can only worsen your feelings, opening the door to mental depression to join your financial depression. So, even though you may be ashamed of the situation you are in, you should still be around those you love.
If you meet certain requirements, you may be able to get a lower monthly payment on your financed vehicle. It is possible to get your car payment lowered if you file using Chapter 7. In order for this to succeed, you must have bought your car in excess of 910 days before filing, have a higher interest loan for it as well as a consistent work history.
Bankruptcy laws are very exact and very important, so ensure that you’re well aware of all current laws before you file a petition. For example, it is against the law to transfer any assets from the filer to another for a year before filing. It is also against the law to max out your credit cards before filing for bankruptcy.
Go over the debts you are currently paying off before filing for bankruptcy. Check the bankruptcy laws in your state to make sure you have not done anything in the past year to make yourself ineligible to petition for bankruptcy. Learn the rules regarding bankruptcy before making any final financial decisions.
Nobody enjoys filing for bankruptcy, but at times, you can’t avoid it. After reading these tips, you can go through the process with some helpful tips. If you can understand the path that others have followed, your journey will be more successful.