Filing personal bankruptcy is a somewhat complex process. There are different kinds of bankruptcy you can file, and the kind you select depends on your individual financial picture and what types of debt you have. It’s imperative that you learn everything you can about the process before you even think about filing. This article has information that can help you.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. The fact is that the credit card debt will be ineligible for discharge, and your tax debt may increase. Transferring the debt to another medium (e.g. a credit card) won’t magically make a tax debt discharagable, either. If you live in an area where tax can be discharged through bankruptcy, financing your tax bill is pretty pointless.
Getting unsecured credit post-bankruptcy will likely be difficult. If this happens to you, think about applying for a couple of secured credit cards. When you do this, it shows your determination to fix your credit history. If you do well with a secured card and make strides to repair your credit, you will ultimately be able to receive an unsecured card.
Make certain that you comprehend the differences between Chapters 7 and 13. If Chapter 7 is what you file, your debts will get eliminated entirely. All happenings with creditors will disappear. With a Chapter 13 bankruptcy, you will have to make payments for 5 years before the debts are forgiven. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
Understand the differences between Chapter 7 and Chapter 13 bankruptcy. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. Learning about bankruptcy is not simple, so call a bankruptcy attorney to make an appointment to ask questions.
Find out more about Chapter 13. If your source of income is regular and your unsecured debt is less than a quarter million, Chapter 13 bankruptcy is something you are able to file for. That kind of bankruptcy allows you to hold on to your personal things and real estate while repaying your debts with a plan to consolidate your debt. This repayment period usually lasts from three to five years. If you make your payments faithfully during that time, any remaining unsecured debt will be eliminated. Just know that missing one payment could cause your case to be dismissed.
Once your bankruptcy filing is under way, take the time to decompress a little. It is common for people to stress when filing. Depression and burn-out from pent of stress will do nothing to help your situation, so it is critical to let go a little. After you have finished filing for personal bankruptcy, your life will improve.
Refrain from feeling shameful about your bankruptcy. Many people get feeling of guilt when going through bankruptcy. These are useless emotions, however, and can be harmful to your mental state. If you are filing for bankruptcy and you are thinking negatively about the situation, make an effort to stop that now.
It is important to file bankruptcy before its too late. Often, people try to act like they are not in financial straits. They imagine the issues will blow away, but they do not. If debts are not dealt with quickly, things can quickly get out of control. Not only will you be faced with late fees and interest, but you may also be faced with a wage garnishment or foreclosure if you ignore your financial woes. You should call a good bankruptcy lawyer and ask for advice as soon as you find your debts have become completely unmanageable.
Before petitioning, you need to know what the personal bankruptcy rules are first. There are many traps in the bankruptcy laws that could trip up your case. Some mistakes can even lead to your case being dismissed. Do the proper research on bankruptcy before taking the next step. The proceedings will be much smoother with this information.
Now you can probably see that filing bankruptcy is a decision that is best thought out carefully before pursuing. If you know what makes sense for you, you can work with an experienced bankruptcy lawyer and get ready to experience a clean financial slate.