Money Problems? Learn More About Personal Bankruptcy
Posted at by PConran on category BankruptcyThe economy is not in good shape. A lot of people with no jobs find themselves in debt. Because more people are falling into debt, more people are filing for bankruptcy. The following article will help you, or your loved ones, gain control of your financial situation and hopefully prevent bankruptcy.
Once you file for bankruptcy, you will have a hard time getting loans or credits. If you find yourself in this situation, you may want to think about getting a secured card or two. If you pay what you owe back promptly at all times, you can show that you are taking steps to be responsible about your payments and credit rating. After a time, you are going to be able to have unsecured credit cards too.
Don’t pay for an attorney consultation and ask him or her anything you want to know. Most lawyers offer free consultations, so consult with a few before settling on one. Choose to file only if your lawyer has convinced you that this is the best decision. After your consultation, take your time to make your decision. You have lots of time for consulting with other lawyers.
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. In Chapter 7 most of your outstanding accounts will essentially be erased. You will be removed from any contracts you have with your creditors. But, with Chapter 13, you will be in repayment plan for about 5 years prior to any debts you have being totally dissolved. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
It is wise to meet with several lawyers before making a final decision, take advantage of the free consultations to find one that is a good fit for you. Never settle for speaking with a paralegal or an assistant. They are not trained, nor allowed, to pass on legal advice. Interviewing multiple attorneys is a good way to find the best fit.
It is important to protect your home when filing bankruptcy. Just because you’re going bankrupt doesn’t mean that you also have to be homeless! Depending on whether the value of your home has decreased or if you have a second mortgage on the home, you may end up keeping it. Another option is the homestead exemption that has certain income and financial requirements, but may also allow you to keep your home.
Consider filing for Chapter 13 bankruptcy. If your total debt is under $250,000 and you have consistent income, Chapter 13 will be available to you. You can secure your home under Chapter 13 and pay your debts with a payment plan. This plan usually lasts from 3 to 5 years, after which, you will be discharged from all 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.
If your earnings are higher than your expenses then filing for bankruptcy is a waste of time and money. Bankruptcy might seem like a good way to get out of paying your bills, but it will devastate your credit for the next ten years.
Find out about lowering the cost of the payment you pay monthly on your car, if you are afraid of losing it. Chapter seven bankruptcy often provides for the lowering of payments. The car loan must have been initiated prior to 910 days before your petition. It must carry a loan with high interest. You should also have a steady history of work.
The economy is rebounding slowly, but there are still people who can’t find employment that pays a living wage. Even long-term job loss does not inevitably have to result in bankruptcy. Now you know all the options available to avoid bankruptcy, if at all possible. Godspeed.