Debt is something a lot of people have to deal with on a daily basis. Their bills pile up higher while debt collectors and creditors keep their phones ringing constantly. If this sounds like your situation then perhaps filing for bankruptcy may be in the cards for you. To learn more about the process and what it means for you, check out the information provided below.
It is important that you increase your knowledge on personal bankruptcy by reviewing websites that provide reliable information. The United States Department of Justice, American Bankruptcy Institute, along with many other websites can provide you with the information you need. As with everything in life, the more you know about filing a claim, the better off you’ll be. You can properly prepare when you know what you’re preparing for.
Do not use a credit card to pay income taxes and then file for 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. One thing that you should remember is that if your tax is dischargable, your debt will also be dischargeable. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
Be aware of recent changes, if any, in the bankruptcy code. Bankruptcy laws constantly change and it’s crucial you know about them so you the process of filing for bankruptcy goes smoothly. A qualified bankruptcy attorney is the best source for the latest information regarding the laws in your state.
Be sure to weigh all of your options before deciding to file for personal bankruptcy. For example, there are credit counseling services that can help you to deal with smaller amounts of debt. Also, you could try to get your payments lowered on your own. If you decide to do this, get a copy of anything you agree to.
Learn about teh differences between Chapter 13 and Chapter 7 bankruptcy. Take the time to learn about them extensively, and then figure out which one will be best for your particular situation. Engage your attorney in a conversation about each type, and ask him to answer any questions you may have before deciding which kind is right for you.
Find out if you can use Chapter 13 bankruptcy, as it may help you better than the other laws. If you owe an amount under $250,000 and have a consistent income source, Chapter 13 may be right for you. This type of bankruptcy protects your assets from seizure and lets you repay your credits over the course of a few years. The length of the plan is generally up to five years, and when this is over, you will be free of 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.
Spend time with friends and family to keep your stress levels to a minimum through the bankruptcy filing process. The process of bankruptcy can prove particularly brutal. It is lengthy, stressful and often leaves people feeling ashamed, unworthy and guilty. A lot of people hide away until the entire proceedings have been played out. Isolating yourself from your loved ones can lead to feelings of depression. For this reason, if you are undergoing personal bankruptcy proceedings, you must continue to live a normal life, spending time with your friends and relations.
Before ultimately deciding whether or not to file for bankruptcy, be sure to weigh the different options available to you. Some alternatives to filing for personal bankruptcy include debt repayment plans, interest rate reduction plans, and debt consolidation. Talk with the personal bankruptcy lawyer to find out more. If a foreclosure is on your horizon, look into loan modification plans. Your particular loan holders can provide a lot of assistance if you’re just willing to speak with them. You can negotiate lower rates, longer terms, and other means of repayment that may keep you from having to file a claim. Many times creditors are happy to work with you to ensure that you will repay your loan.
Clearly, it is possible for those thinking of filing for bankruptcy to get a great deal of assistance. Tackling this in a logical and emotionless manner will relieve you of your debt issues while giving you a fresh start for the future.