Bankruptcy can be tough. If you are thousands of dollars in debt, you may not have many options. However, there are some things that can be done to get what you want.
Before undertaking the bankruptcy process, ensure you have made the correct decision. You have better options. For example, you could try credit counseling. Bankruptcy is a serious negative on your credit history so make sure you have no other options before you file. It is important to keep your credit history as positive as possible.
When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. Unless there are no other options, your retirement funds should never be touched. If you do have to dig into your savings, make sure that you leave enough to sustain you and your family for a couple of months.
Be sure to weigh all of your options before deciding to file for personal bankruptcy. For example, consumer credit counseling services can often help you figure out a workable repayment plan with creditors. You could even negotiate for lower payments. However, you should ensure that you always obtain a written record of all the changes to your debt that you’ve agreed to.
Think about all your options before pulling the trigger. Talk to a bankruptcy lawyer to see if a debt repayment plan or reduction in interest rates is a viable option for you instead of bankruptcy. If a foreclosure is on your horizon, look into loan modification plans. Your lender can adjust your loan in many ways including extending the time you have to pay, reducing your interest rate, or canceling some of your late fees. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
Talk with your lawyer about getting lower payments for any car you wish to keep. Most of the time Chapter 7 bankruptcy will allow your payments to be lowered. Here are the qualifications in regards to your vehicle: you must have bought it nine hundred and ten days or more before filing for personal bankruptcy; your loan must carry high interest; your work history must be steady and solid.
If you are in the midst of a Chapter 13 bankruptcy, it is possible to apply for certain loans. However, the process of approval is a bit more stringent. You must meet with a trustee to gain approval for a new loan. It is important to make a budget and prove that you are able to afford the payment. You also have to prepare yourself to explain the reasons you need to buy the item.
If you are filing for bankruptcy, it is imperative that you have a good understanding of your rights. Certain unscrupulous creditors will try to convince you that certain debts can’t be discharged in bankruptcy. There are not many debts that can not be bankrupted, student loans and child support for example. If a collector uses this tactic about debt that can, in fact, be discharged through bankruptcy, report the collection agency to the attorney general’s office in your state.
Prior to filing for bankruptcy, purge from your vocabulary the word “shame”. Bankruptcy can sometimes leave people feeling guilty, ashamed and alone. Continuing to let yourself feel that way can damage your emotional health and does not benefit you in your endeavors to deal with your financial situation. Staying positive and upbeat is the proper way to deal with bankruptcy.
Review bankruptcy rules before you file your petition. The bankruptcy laws are complex, and things could go badly if even one thing is out of place. If you make an egregious mistake, the judge might even dismiss your case. Take the time to research personal bankruptcy before moving forward. Doing this can make the process simpler.
Do not take a large cash advance from credit cards prior to filing, knowing that bankruptcy erases all debts. Not only is this fraud, but you could end up having to pay back the money, even once you have filed for bankruptcy.
Don’t stress about trying to determine whether bankruptcy is something you must do. Yes, it is hard to admit that you need help; however, the longer you wait the deeper in debt you get. Talk to a lawyer as soon as you can to get the advice that you need.
Though you may have filed bankruptcy, you are not at the end of your financial life. By demonstrating responsible financial management, (saving money, making payments on time) you can impress creditors and rebuild your credit rating. So implement a savings program, and watch how much it helps you when you need to apply for a home or car loan.