It can be a difficult process to file for bankruptcy. Because of the various types of claims out there, and also the different ways in which you can approach filing, your particular situation will be personal to you. That’s why you should research personal bankruptcy prior to deciding whether or not you should file. Check out the tips listed below if you want some solid info on the subject.
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. Remember that if you can discharge the tax you can discharge the debt. So, there’s no reason to make use of a credit cards if it will not be discharged in bankruptcy.
When it gets time to think about bankruptcy, avoid using your retirement or savings to pay off the creditors or even make attempts to settle the debt. Retirement funds should be avoided at all costs. You may need to withdraw some funds from your savings account, but don’t take everything that is there as you will be bereft of any financial backup if you do.
Never shirk on the truth in your petition for bankruptcy. Do not try to shield some assets or income from your creditors. This can get you in serious trouble and prevent your bankruptcy petition altogether.
Do not despair, as it’s not the end of the world. If you file for bankruptcy at the right time it could enable you to get your property back that you lost to repossession. If your personal property was repossessed within 90 days before your bankruptcy filing, you may have a chance of getting it back. Talk with an attorney who can guide you through the process of filing a petition.
When you do meet with a lawyer make sure that they answer all of your questions and that they do not charge you for consultation alone. Most lawyers provide a consultation for free, so consult with many of them before picking which one you want to hire. The lawyer who properly answers your questions is the one you should hire. It’s isn’t necessary to make a choice right away. Consulting with several attorneys will also help you find someone you trust.
Before you file, make sure you understand current bankruptcy laws. These laws change regularly and you should stay up-to-date so you can make the best decisions. To know what these changes are, go to your state’s website or contact the legislative offices.
Protect your house. Just because you’re going bankrupt doesn’t mean that you also have to be homeless! You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. You should also examine the possibility of taking a homestead exemption. This could apply if your income falls below the financial threshold.
If you can afford to pay your bills, bankruptcy is not a wise option. Though bankruptcy may appear to be a good way to escape your debts, it does affect your credit negatively for a fairly long time.
Talk with your lawyer about getting lower payments for any car you wish to keep. Often, you can negotiate a lower payment through bankruptcy. Your car must have been purchased more than 910 days prior to filing, be a high interest loan, and you must have had a steady work history for this to work.
If you decide to file for bankruptcy, it’s important that you’re educated about your rights. There are bill collectors who will claim that you cannot add your debts to your bankruptcy case. There are, indeed, some debts that cannot be bankrupted. Among them are student loans, child support and alimony payments. If any debt collectors tell you that their debts can’t be bankrupted, make a report with your state attorney general.
Clearly, filing for bankruptcy takes a great deal of thought and consideration in advance. If bankruptcy is sensible option for you, a good and experienced bankruptcy attorney is a must have to help you begin the process of starting your financial situation anew.