Bankruptcy is something no one wants to experience. Changing circumstances often creates a situation in which there’s no better choice, therefore, knowing how to properly deal with it the right way is important. If you’re in this boat, read on for some helpful advice.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. A common rule is that dischargeable tax means dischargeable debt. So as you can see, in this situation there is no need to use the card when the debt will be discharged when you file for bankruptcy.
When looking for a lawyer to handle your bankruptcy claim, the best way to go is off of a personal recommendation instead of simply flipping through the phone book. Don’t allow yourself to be taken advantage of by predatory lawyers just because you are filing for bankruptcy. It is important to find someone trustworthy.
Stay positive. Bankruptcy might help you get back things you thought you’d lost and had repossessed, such as electronics, vehicles and jewelry. Filing for bankruptcy may allow you to regain ownership of recently repossessed property. Talk with an attorney who can guide you through the process of filing a petition.
Before pulling the trigger on bankruptcy, be sure that other solutions aren’t more appropriate for your case. You could find relief from small debts by using a consumer credit counselor. You can also talk to creditors and ask them to lower payments, but be sure to get any debt agreements in writing.
Research Chapter 13 bankruptcy, and see if it might be right for you. With a regular income and unsecured debt below $250,000, Chapter 13 is probably best for you. This will allow you to keep your personal property and real estate and repay your debts via a debt consolidation plan. Generally, this stays in effect for up to 5 years. Afterwards, your unsecured debts clear from your accounts. Stay mindful that should you for any reason miss even one plan payment, your whole case is going to get thrown out by the court system.
Make sure you understand your rights as you file for bankruptcy. It is not unusual for creditors to claim that their debt is not able to be discharged. There are a few debts that cannot be cleared, such as student loans and child support, but be sure to know the details when dealing with debt collectors. If a collector tries to convince you that some other type of debt, such as a credit card, is non-discharagable, get the company’s information and send a report to your state attorney general’s office.
It is important to not wait for the final minute to petition for bankruptcy. Some folks ignore financial difficulties for a long time, and this can be disastrous. Debt could become uncontrollable and by not dealing with them properly, your wages could be garnished or you may find your home in foreclosure. As soon as you see your debts getting out of control, seek the counsel of a good bankruptcy attorney to see what your options are.
If you are thinking about filing for bankruptcy, one of the first things you should do is look into the laws of your state. Did you know that in some areas, you cannot transfer assets from yourself to another person in the year previous to filing occurring? Also, you must never incur significant new obligations must prior to filing for bankruptcy.
Good advice is important when filing for bankruptcy. The process will be a lot easier if you have the right information. This article has given you a lot of information that will help you succeed during the filing process and beyond.