How You Can File Personal Bankruptcy

The circumstances that culminate in a bankruptcy filing are likely unpleasant, though they do not need to define the rest of your life. The point of bankruptcy is to have a clean slate and a fresh start. The article you’re about to read contains great information on bankruptcy and how you can proceed with filing a claim.

Think twice if you have struck upon the idea of paying off your taxes by credit card and subsequently filing for personal bankruptcy. In many parts of the country, you cannot get this debt discharged, and in the end you will be left owing the IRS a big sum of money. Should the tax be dischargeable, the debt is often dischargeable as well. If you live in an area where tax can be discharged through bankruptcy, financing your tax bill is pretty pointless.

Don’t be afraid to remind your attorney of certain details in your case. You cannot expect your lawyer to remember every important detail without some reminder from you. This is your future in their hands, so don’t be scared to mention it.

Prior to filing for bankruptcy, research which assets will remain exempt from creditors. The Bankruptcy Code provides a list of all the different kinds of assets that you can exclude. It is vital that you completely understand which assets are protected and which assets can be seized prior to filing bankruptcy. If you neglect this important step, you might be blindsided when a possession that is important to you is taken to repay creditors.

Chapter 7

Be certain to grasp the distinction between Chapter 7 and Chapter 13 bankruptcy cases. The Chapter 7 variety can help you eliminate your debts almost entirely. Your ties with all creditors will get dissolved. If you choose to file for Chapter 12 bankruptcy, you’ll be put into a 60-month plan for repaying your debts before they’re eliminated. Both options have advantages and drawbacks, so do your research before deciding.

Understand the differences between a Chapter 7 bankruptcy and a Chapter 13 bankruptcy. By researching each type, you can begin to understand which method is right for you. Do not hesitate to have your lawyer explain any details that seem difficult to grasp. This will help ensure you make the right choice when filing.

Consider Chapter 13 bankruptcy for your filing. If you are receiving money on a regular basis and your unsecured debt is under $250,000, you may be able to file Chapter 13 bankruptcy. You can secure your home under Chapter 13 and pay your debts with a payment plan. This plan normally lasts from three to five years, in which you’ll be discharged from unsecured debt. Just ensure that you take necessary precautions, as missing one payment can result in the court dismissing your case.

Don’t hide from your friends and family while you go through bankruptcy. Going through a bankruptcy can be an excruciating experience. At the end of the process, many people are left with feelings of shame and worthlessness. Avoidance of friends of family during the process is not uncommon. You shouldn’t do this, though, as staying away from the world can amplify any emotional issue you are having, and they could even morph into full-blown clinical depression. This is the reason that you need to take the time out to spend time with everyone you love despite what your financial situation is.

Don’t file bankruptcy if you can afford to pay your debts. Though bankruptcy may appear to be a good way to escape your debts, it does affect your credit negatively for a fairly long time.

Know your bankruptcy rights. Some debt collectors like to say that you cannot file for bankruptcy on these debts. Only a few debts, including child support and tax liens, are ineligible for bankruptcy. Should you face a creditor like this, and you are informed that the debt is not valid under the bankruptcy. These types of infractions should be reported.

Make sure the time is right when you file a bankruptcy claim. Timing is critical, particularly when it comes to filing for bankruptcy. In some cases, it is better to file immediately, while other situations benefit from trying to get certain finances in better shape before filing. Have a chat with a bankruptcy specialist to discover when the ultimate time would be for you to file.

Judging from the information contained within the article alone, you can now see that there are ways to get out from under the piling debt. Yet after bankruptcy, you can be happy again. Actually, by using the advice you’ve learned here, your story of hardship could have a happy ending after all!

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