The economy has been in a poor state for several years now. When there is a bad economy there are a lot of people losing their jobs and having problems with debt. Debts can often lead to bankruptcy, an outcome nobody ever wants. If you or someone you know is in jeopardy of going bankrupt, then read this article to figure out how to get out of this situation.
When people owe more than what can pay, they have the option of filing for bankruptcy. If this describes your situation, it makes sense to become familiar with relevant laws. Each state has its own set of rules regarding bankruptcy. Some states may protect you home, and some may not. Before filing for personal bankruptcy, be certain that you are familiar with the laws.
Don’t hesitate to give your attorney a heads-up about something she has missed. Don’t just assume they already know and that they have these important details committed to memory or written down. Don’t be afraid to speak up, as it is your case and your future will be affected by its outcome.
Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask a lot of questions. Most lawyers offer free consultations, so consult with a few before settling on one. Don’t choose a lawyer until your questions about bankruptcy are sufficiently answered. There is no need to offer an immediate hire, so take your time. You could even go to different lawyers for advice.
Consider other alternatives before filing for bankruptcy. For example, consumer credit counseling services can often help you figure out a workable repayment plan with creditors. You should also try negotiating a payment plan with your creditors; make sure you get a written agreement of the new payment plans.
You need to educate yourself on the differences between Chapter 7 and Chapter 13. Chapter 7 involves the elimination of all of your debt. All of your financial ties to the people you owe money to will disappear. Chapter 13 bankruptcy allows for a five year repayment plan to eliminate all your debts. Take the time to learn more about these different options so you can make the best decision possible.
Make sure you know how to differentiate between Chapter 13 and Chapter 7. Be sure you go on the Internet and do your research to see what’s best for you. If anything you see is unclear or doesn’t make sense, go over it again with your attorney before making the final filing decision.
Chapter 13 Bankruptcy
Consider Chapter 13 bankruptcy. 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. Not only can you repay your debts through consolidation, personal property can be kept, as well as real estate. This lasts for three to five years and after this, your unsecured debt will be discharged. Bear in mind that if you miss a single payment that is due under your plan, the entire case will be dismissed by the Court.
When filing for personal bankruptcy, always supply all of your financial information. Forgetting to add these may cause your petition to be delayed, or even dismissed. It is better to have something on there that you are unsure about, rather than not include it at all and risk a dismissal. This can include side jobs, any vehicles to be counted as assets, and any loans you may currently have.
Before you file your petition, be sure that you understand personal bankruptcy rules. There are several pitfalls with personal bankruptcy that can make your case harder to handle. It is even possible for your whole petition to be thrown out of court due to errors being made. This is exactly why it’s imperative that you take the time necessary in order to research what you can about bankruptcy. This will help your process go smoother.
As you are heading towards a bankruptcy filing, don’t be tempted to run up cash advances on your credit cards in the belief they will be erased in the legal proceedings. This is fraud, and you will be required to pay that money back.
The economic recovery has bypassed many people, leaving their finances in disarray. Even long-term job loss does not inevitably have to result in bankruptcy. Simply remain persistent and positive. Opportunities will eventually come your way. Keep these thoughts close and it will enable you to have a better chance of avoiding the need to file bankruptcy. Best of luck.