Are you in debt? Do you think that there is no way to get out of your debt except to file for bankruptcy? With the Internet there is plenty of advice these days on ways to avoid disastrous situations such as bankruptcy. Read through this guide and learn how you could avoid being bankrupt.
Most people end up filing for personal bankruptcy because they owe more than they make. When you get into this situation yourself, your first step is to familiarize yourself with your local bankruptcy regulations. Different states use different laws when it comes to bankruptcy. Your house is safe in certain states; however, in other states, it isn’t. Familiarize yourself with the bankruptcy laws of your state prior to filing.
If you are thinking about paying off your tax obligations with a credit card and then filing bankruptcy, think again. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. A common rule is that dischargeable tax means dischargeable debt. Because of this, transferring the debt to your credit card is pointless.
Try to get a bankruptcy lawyer that your friends recommend, as opposed to someone that you find from the Internet or yellow pages. There are various companies that prey on the financially desperate, so you need to find someone you can trust to ensure the process goes smoothly,
Be sure your home is well protected. There are many options available to help protect you from losing your home. Depending on if your home’s value has gone down or if it has a second mortgage, you might be able to keep it. If you’re not sure, however, you can always study the particular homestead exemption regulations. You will learn everything you need to know.
If you are making more money than you owe, bankruptcy should not even be an option. Although bankruptcy may feel like a simple method of getting out of your large debt, it leaves a permanent mark on your credit history for up to 10 years.
Chapter 7 Bankruptcy
If you are moving forward with a Chapter 7 bankruptcy, you need to learn how that can negatively affect anyone who shares loans with you. Debts that involved a co-signer can be discharged in Chapter 7 bankruptcy. Sadly, this will not be the case for your co debtor. Your creditors may simply turn their attention to your hapless acquaintance.
If you are in the midst of a Chapter 13 bankruptcy, it is possible to apply for certain loans. It is just tougher. You need to contact your trustee so you can get approved for a new loan. You will need to make a budget and prove that you will be able to afford your new loan payments. You will always have to let them know why this item needs to be purchased.
An understanding of your rights is important before filing for bankruptcy. Certain unscrupulous creditors will try to convince you that certain debts can’t be discharged in bankruptcy. There are, indeed, some debts that cannot be bankrupted. Among them are student loans, child support and alimony payments. If you are told differently by a collector, research the information yourself. If you find they are in error, get the name of their company, phone number and any identifying info so you can report it to the attorney general in your area.
If you devise a plan, then you can make the situation much better. If you can buy yourself, time then do it; the more the better. If you are taking the steps necessary to avoid bankruptcy, you are on the right track. Once you have a plan, you’ll be ready for whatever happens.