Learn from your mistakes and vow to be more financially responsible after filing for personal bankruptcy. With a clean slate, it is possible to start over both financially and personally. Keep reading to see how bankruptcy can actually give you a new lease on life, rather than function as a permanent financial albatross.
Be aware that getting unsecured credit is going to be tough once you’ve gone through bankruptcy. Look into getting a secured credit card in order to get back on your feet with building credit. This will show other people that you’re serious when it comes to having your credit record in order. If you pay your secured card off on time, you’ll eventually find that companies will start offering you unsecured credit.
You may end up losing more than you bargained for when you file a bankruptcy claim, so be sure that you know just which assets may be taken before filing. The Bankruptcy Code includes a list of the types of assets that are exempt from the bankruptcy process. You need to read the exemptions for your state, so you know what property you can protect. You wouldn’t want to unexpectedly lose any possessions you treasure.
Do some research about laws and legislation before filing. The laws change a lot, so you need to look them up and have a better idea of how to properly approach the bankruptcy process. If you are not sure about the current laws all you have to do is look into what laws have been passed.
Your most important concern is to protect your home. Filing for bankruptcy does not mean you have to lose your home. It may be possible to keep your home if the value has depreciated, or there is a second mortgage. Otherwise, there is a homestead exemption you should look into, as it might let you stay in your house.
Remember to spend some quality time with your loved ones. Bankruptcy proceedings can be extremely harsh. This long and stressful process can leave a person feeling guilt ridden, unworthy and ashamed. It can be hard to face the world while the bankruptcy process is taking place. Pulling away from people who care for you will not help the situation, and can cause your negative feelings to intensify. So, even though you may be ashamed of the situation you are in, you should still be around those you love.
Before ultimately deciding whether or not to file for bankruptcy, be sure to weigh the different options available to you. You might be able to address your debts by arranging a repayment plan or a reduction in your interest rates. Get professional advice on these matters from a bankruptcy lawyer. For example, if you are in talks of foreclosure, you could use a modified loan to overcome your debt. This type of plan allows your lender to work with you eliminating charges, extending your loan, and lowering interest rates to help you pay back the loan without drowning in debt. Creditors would rather be repaid, however slowly, than have you declare bankruptcy.
Remember that filing for Chapter 7 personal bankruptcy will not just affect you. Think about the effect it will have on business associates, friends and family or anyone else who may be a co-signer with you. When you file a Chapter 7, your debts will be dissolved. However, creditors will want to hold your co-signer responsible completely.
Don’t let shame consume you during the bankruptcy process. Filing for bankruptcy leads people to feel all sorts of emotions like shame, guilt and feeling irresponsible. These feelings, however, are of no benefit to anyone, and they can be detrimental to your mental health. Focusing on the positive during this stressful time is a good strategy for coping with your ordeal.
Don’t wait until it is too late to file for bankruptcy. What a lot of people do is ignore the fact that they are in a financial crisis and think that their debt is not going to catch up to them. It is easy you to lose control of your debt, and avoiding the problem will make things worse. As soon as you discover your debt is getting too big, immediately get hold of a bankruptcy attorney so that you can talk to him or her about your options.
Again, it is likely that whatever precipitated a bankruptcy filing was not something on which you look back fondly. It doesn’t have to be that way after bankruptcy. The truth is, that by using the tips in this piece, it is possible to make bankruptcy a positive experience that gives you the fresh start you need.