If you have been threatened by repossession of your possessions, it is time to think about filing for bankruptcy. Declaring personal bankruptcy can stop harassment from debt collection agencies and provide you with a fresh start for getting your finances on the right track. This article will provide you with information to help you through this rough time.
Learn as much as you can about bankruptcy by going to informational websites. The United States Department of Justice and American Bankruptcy Institute are both sites that provide free advice. 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.
When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. Retirement accounts should never be accessed unless all other options have been exhausted. Dipping into savings may need to happen, just don’t totally wipe it out, or you might not have much financial security later.
After filing for bankruptcy, you may have difficulty getting approved for unsecured credit. In this event, you should attempt to apply for a secured card or two. This will allow you to start building a good credit history while minimizing the bank’s risk. After a time, you are going to be able to have unsecured credit cards too.
Try going to a personally recommended bankruptcy lawyer instead of using a phone book or the Internet. There are many companies who take advantage of financial desperation; that is why it is important that you get someone that is trustworthy.
Before filling for bankruptcy, determine which assets will be exempted from seizure. Check the bankruptcy laws in your state to find out if certain items are excluded from your bankruptcy filing. It is crucial to read the list before you file for bankruptcy so you know whether your favorite items will be taken. If you aren’t aware of this, you could lose some assets that you value.
You should not have to pay for an initial legal consultation, and such meetings are great opportunities to ask lots of questions. Most lawyers will meet with you for free and give you helpful advice, so meet with several. Don’t hire an attorney who fails to address all your concerns and questions. You do not need to make a decision immediately after the consult. You can take your time and check out several attorneys before making your final selection.
There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice. Chapter 7 bankruptcy completely wipes out your debt. You will no longer be liable for any money that you owe to your creditors. Chapter 13 is different, though. This type of bankruptcy entails an agreement to pay off your debts for five years prior to wiping the slate clean. It is worth while to take your time to research both types of bankruptcy to decide which option works best for you, and your financial situation.
Take advantage of the opportunity to consult with a number of bankruptcy lawyers who offer the first visit at no charge. By law, paralegals and assistants can not give legal advice, so be sure that you are meeting with an actual attorney. Considering several different lawyers can help find someone to trust.
If you make more money than what you owe, filing for bankruptcy is not a good option. Sure, bankruptcy can get rid of that debt, but it comes at the price of poor credit for 7-10 years.
Take into consideration all the ramifications of a Chapter 7 bankruptcy. Filing for this can impact any co-debtors, such as friends or family. Speak to an attorney or read the bankruptcy laws in your state to find out if certain loans can be excluded from your filing. However, your creditors will be able demand that your co-debtor pays the debt off in full.
Do not think of filing for personal bankruptcy as a shameful thing. The bankruptcy process can make many people feel ashamed, guilty and unworthy. These sorts of feelings are not helpful to you. Indeed, they may cause you mental anguish. To best deal with filing for bankruptcy, look for the positives in the situation.
Don’t wait to file for bankruptcy. For some people, they tend to ignore their poor financial situation and just wishing it away, but that is only putting you in more danger. Yet you can have debtors come after you and potentially take your home if you are not handling your debts properly. 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.
Do your homework so you thoroughly understand the laws pertaining to bankruptcy before you file. There are often laws prohibiting the transfer of money from the filer for a certain period preceding the bankruptcy filing. Other laws you need to know include debt-based regulations. You cannot increase debt via credit cards prior to filing a claim. Your finances basically have to remain frozen.
Don’t just assume bankruptcy is the right option, especially if you have not considered others. Credit counseling is an important option for you to pursue. There are many non-profit debt counseling services available. These organizations can work with creditors to lower your payments and interest rates. They pay your debts and you repay them.
Many people who file for bankruptcy vow to stop using credit cards. The fallacy in this thinking is that credit is needed to improve your credit history again. Without rebuilding your credit through the use of new credit, you will have trouble with future purchases that require good credit. You can rebuild your credit slowly, beginning with just one credit card.
Bankruptcy is an option, but you should look at other options before filing. Be careful, because many services offering debt consolidation are scams, and can leave you deeper in debt than you were already. Take what you’ve just learned to heart, and make wise financial decisions going forward.