If you have accumulated a lot of debt and are about to file for bankruptcy, let go of your worries. By simply searching online and doing a little research you can possibly avoid filing for bankruptcy. Read through this guide and learn how you could avoid being bankrupt.
Knowledge is power when you’re considering bankrupcy; there are many websites available to help you. The United States Department of Justice and American Bankruptcy Institute are two such places to look. The more you know, you can be confident you are choosing the right thing and that you are taking the right road to make sure your bankruptcy proceeds as easily as possible.
Do not attempt to pay your taxes with your credit cards and subsequently file for bankruptcy. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. 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.
Be certain you are making the right choice before you file for bankruptcy. You can find services like counseling for credit that consumers can use. If you file for bankruptcy, a mark is permanently left on your credit. Therefore, before you do this, you should utilize all the other options that you have.
When bankruptcy seem inevitable it is important not to use your retirement funds or emergency savings to pay creditors. You should never touch your retirement accounts, unless you have absolutely no choice. 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.
Do not give up hope. You can often have property returned to you. Autos, jewelry and even electronics that have been repossessed, could be returned. You may be able to recover repossessed property if the repossession occurred fewer than 90 days ago. Talk to a lawyer for help with the petition filing process.
Learn how Chapter 7 bankruptcy and Chapter 13 bankruptcy differ from each other. Research both types of bankruptcy online, and weigh the positives and negatives each would offer you. If something doesn’t make sense to you, go over it with your lawyer prior to choosing which one to file.
Look at all of your options prior to deciding to file for bankruptcy. Talk to a bankruptcy lawyer to see if a debt repayment plan or reduction in interest rates is a viable option for you instead of bankruptcy. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. The lender is able to help you in a number of ways, such as reducing interest rates, eliminating late charges, and even lengthening the loan, giving you more time to pay. Remember that creditors desire to get paid and usually debt repayments are often preferable when dealing with bankrupt debtors.
Before you choose Chapter 7 bankruptcy, think about what effect that is going to have on any co-signers you have, which are usually close relatives and friends. Debts that involved a co-signer can be discharged in Chapter 7 bankruptcy. But, bear in mind, the debt now becomes the sole responsibility of your co-debtor.
File when the time is right. Timing can be critical when it comes to personal bankruptcy cases. In certain situations, you should file right away, but other situations will warrant you waiting. Speak with a lawyer specializing in bankruptcy in order to learn when you should file your petition.
Don’t drag your feet when it comes to filing bankruptcy. The judge reviewing your petition will consider your recent behavior, purchases, income and payments when making a decision. It is very common for personal debts to snowball suddenly. When this happens, terrible consequences, such as wage garnishment and foreclosure result. Consider all possible options before filing bankruptcy.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. Here is one example, an individual who files for bankruptcy cannot transfer any assets for a year before the filing date. Also, it is illegal to load up your credit cards with debt right before filing occurs.
When you are filing for bankruptcy, make sure you list all of the financial information you may have. Leaving out information either purposely or by mistake can prolong your petition, or have it dismissed completely. Even if you think a sum is insignificant, add it into your documentation. Include any income from jobs that you do on the side or assets, such as property and vehicles.
With the best planning, your situation will improve. If you are able to buy some time, you should do so. That said, this only makes sense if you are making progress in solving your financial problems. The time to plan you future is now so get on with it.