Bankruptcy can be both a relief and a major stressor. On one side, you will need to handle a lot of people looking into your personal finances. By contrast, once your bankruptcy is complete, you will have the freedom to rebuild your credit without being hounded by debt collectors. Read on for advice on easing the pain of bankruptcy.
Don’t use credit cards to pay your taxes if you’re going to file bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. Should the tax be dischargeable, the debt is often dischargeable as well. Because of this, transferring the debt to your credit card is pointless.
Be warned that after your bankruptcy, you may stand out as a leper to credit institutions. You may be unable to get a simple credit card. If this happens, instead you should turn your attention to secured credit cards. Using a secured card not only helps to rebuild your credit, but it also keeps you from going more in debt with credit card bills. In time, it may be possible for you to obtain unsecured cards.
Keep at it! You might even be able to get back secured property that has been repossessed in the 90 days before filing. If the property you own has been repossessed under 90 days before the bankruptcy filing, you may still be able to get it back. Speak with your attorney about filing the correct petition to get your property back.
Hire a lawyer if you plan on filing for bankruptcy. Having a lawyer on your side is the best way to avoid mistakes and bad decisions. A bankruptcy attorney can help yo,u and make certain you can do things the right way.
If you’re unsure, then you need to learn what a Chapter 7 bankruptcy can do for you, as opposed to what Chapter 13 does. Do some research about these options so you can choose the best one. If you don’t understand the information you researched, consult with your attorney about the details before you decide which type of bankruptcy you want to file.
Consider filing using chapter 13 bankruptcy. If you currently have some income and don’t have more than $250k in debt, you can declare bankruptcy. This type of bankruptcy protects your assets from seizure and lets you repay your credits over the course of a few years. This plan normally lasts from three to five years, in which you’ll be discharged from unsecured debt. Remember, though, that if you fail to make even one payment, the case will be thrown out and you’ll be right back where you started.
Being with the people who you love should be still be a top priority. Bankruptcy can take a toll on you. At the end of the process, many people are left with feelings of shame and worthlessness. A lot of folks decide to hide themselves from the world around them until the end of the process. Self-imposed isolation can make you feel worse about it and can cause depression. Remember that it is not your families fault for your financial hardships and use this time to pull together and be strong.
Don’t automatically assume that bankruptcy is your only option. Instead of rushing into bankruptcy, a good idea is too speak with an attorney who may be able to get your interest rates reduced or help get you on a debt repayment program. If you are about to lose your house, talk to your lender about a loan modification. Lenders can assist you in a lot of ways, by cutting interest rate charges and cutting off late fee charges. They can also lengthen the loan. Creditors want to recoup the most money possible from debtors, and they can often get more through debt repayment plans than bankruptcy procedures.
If you are concerned about keeping your car, check with your attorney about lowering the monthly payment. Many times, payments can be lowered through Chapter 7 bankruptcy. The car loan must have been initiated prior to 910 days before your petition. It must carry a loan with high interest. You should also have a steady history of work.
Know the rights that you have as you file for bankruptcy. Some bill collectors will tell you that your debts can’t be bankrupted. Most states allow for the majority of debt to be included on a bankruptcy. 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.
Filing bankruptcy has its good and bad points. No matter why you have decided to file, remember that knowledge is power when it comes to managing the situation. The advice you have been provided with has probably helped you better understand bankruptcy. Use these tips to empower yourself before, during and after your bankruptcy.