Most people end up filing for personal bankruptcy because they owe more than they make. If this applies to you, be sure that you know what the laws of your state are. Different states use different laws when it comes to bankruptcy. In a few states, they see to it that your house is protected. This is not the case when it comes to other states. You should be aware of local bankruptcy laws before filing.
Think carefully before you decide to file for bankruptcy. Being aware of the complexity of the issues involved in bankruptcy is essential. What you’ll read in the article below can help you tremendously when filing a claim. No matter what obstacles fall in your path, you can overcome them with good research.
Before undertaking the bankruptcy process, ensure you have made the correct decision. You can also avail yourself of other options, such as consumer credit counseling. Bankruptcy will leave a permanent scar on your credit report and before you take this huge step, you should search through every available option first, to help try and limit the damage to your credit.
You should check with the personal bankruptcy resources available online to educate yourself thoroughly before you begin the process. The United States Department of Justice, American Bankruptcy Institute, along with many other websites can provide you with the information you need. The more you know, the better equipped you’ll be to make the wise decisions needed for a successful bankruptcy.
Protect your home. You do not have to lose your home in the process of a bankruptcy. You can still keep your home, it just depends on your specific situation and the value of your home. Additionally, some states have homestead exemptions that might let you keep your home, provided you meet certain requirements.
Exhaust every other option before making the decision to file for personal bankruptcy. You have better options. For example, you could try credit counseling. Bankruptcy stays on your credit for a whole decade, so if there are less drastic options that will solve your credit problems, it is in your best interest to make use of them.
If you are worried about your car being repossessed, consult your attorney about trying to get the monthly payment lowered. Chapter seven bankruptcy often provides for the lowering of payments. In order for this to be considered, your car loan must be one with high interest, you need a solid work history and the car should have been bought 910 days or more prior to you filing.
No good will come of trying to conceal your assets or your liabilities in the bankruptcy process; you want to be scrupulously honest when you declare bankruptcy. Wherever you file, that court has to be made aware of all details regarding your finances, positive and negative. Put everything out on the table and craft a wise plan for handling the situation the best you can.
Understand the rights you have as a bankruptcy filer. Do not rely on your debtors information about whether or not certain loans can be included in your bankruptcy. Most loans can be discharged outside of certain things, like child support or loans you are paying back due to student lending. If a bill collector attempts to say their bill cannot be discharged, look it up. If they are wrong, report them.
Be sure your home is well protected. Bankruptcy filings don’t necessarily have to end in the loss of your home. If your home has significantly depreciated in value or you’ve taken a second mortgage, it may be possible to retain possession of your home. Another option is the homestead exemption that has certain income and financial requirements, but may also allow you to keep your home.
See to it that you are aware of the laws concerning bankruptcy before you consider filing. For instance, a filer cannot transfer assets to someone else for at least a year before filing. Also, you must never incur significant new obligations must prior to filing for bankruptcy.
Learn how Chapter 7 bankruptcy and Chapter 13 bankruptcy differ from each other. Learn the benefits and drawbacks of each type before deciding which is right for you. Ask your bankruptcy lawyer to clarify anything you don’t understand before making a final decision about which type of bankruptcy to file.
Once your bankruptcy is over, request a copy of your credit report from all of the credit reporting bureaus. Look to see that the reports have accurately documented your discharge and other information. Challenge discrepancies as soon as possible in order to repair your credit.
Certain attorneys offer a phone service that creditors are directed to when they want to speak with you about debts you may owe. You just provide the number, and they call to confirm that the debt is part of your bankruptcy. If everything checks out, the call center should then update their records to show that you no longer owe any money to that company.
Chapter 13 bankruptcy might be a good option, so don’t overlook it. You are probably eligible for Chapter 13 if your income is consistent and your unsecured debt is under $250,000. Declaring bankruptcy can assist you in consolidating your debt so you can repay it more easily. These kinds of plans usually range across 3, 4 and 5 years. Once this is done, all your unsecured debt will get discharged. Just know that missing one payment could cause your case to be dismissed.
If you are facing a looming tax debt, don’t think that bankruptcy can be your savior. It has occurred that tax debt has been paid for by a credit card and then bankruptcy filed immediately after. They do this with the assumption that they can trick their way out of paying their taxes, since the balance is on a credit card. But, this is already covered by bankruptcy law, so you will simply end up owing both.
As you’ve read, you can file bankruptcy several ways. Don’t let all the information and regulations surrounding bankruptcy overwhelm you. Take a deep breath and let the information sink in. When you think things through, you make good decisions in life.
If you’re considering filing for personal bankruptcy, it’s important that you understand the things that caused you to be in your current situation. If you were hit by a bus and racked up hundreds of thousands in medical bills, you’re probably not at high risk for filing again, but if you recklessly maxed out your credit cards, you might want to rethink your habits. Don’t assume that you can handle getting past these things on your own, if you find yourself continuing to do it. Get help.