Bankruptcy: Is It Right For You?
Posted at by PConran on category BankruptcyBeing severely in debt is a very frightening experience. Sometimes, it just snowballs from having a little bit of a financial issue to losing complete control in a short amount of time. Unfortunately, once you’re in this situation, fixing it can be hard. Read on to find tips, insight, and valuable information for clearing your debt and getting a firm grasp on your finances.
If you are considering using credit cards to pay your taxes and then file for bankruptcy, you may want to rethink that. In most states, this debt won’t be discharged, and you could end up owing the IRS a whole lot more. A common rule is that dischargeable tax means dischargeable debt. This makes using a credit care irrelevant, since bankruptcy will discharge it.
Make sure you’ve exhausted all other options prior to declaring bankruptcy. Alternatives do exist, including consumer credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.
Don’t fear reminding your attorney of any specific details of your case. Don’t assume that they will recall every detail that you go over with them without a friendly reminder. This is your bankruptcy case, so do not be afraid to remind your lawyer of any key facts.
Learn the newest bankruptcy laws before filing. Make sure to get the most up-to-date information concerning the bankruptcy laws in your state. To learn about these changes, try contacting your state’s legislation office or checking their website.
Most bankruptcy lawyers offer a free consultation, so meet with several before you decide on one. Ask to speak with the licensed attorney and not a representative, who can not offer legitimate legal counsel. Shopping around for a lawyer can help you find someone with whom you feel comfortable.
Before filing a bankruptcy claim, make sure that your home is well protected. Filing for bankruptcy does not mean you have to lose your home. You could keep your home; it depends on your home’s value or if a second mortgage is on your home. You should also examine the possibility of taking a homestead exemption. This could apply if your income falls below the financial threshold.
Find out more about Chapter 13. If you have a regular source of income and less than $250,000 in unsecured debt, you can file for Chapter 13 bankruptcy. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. 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.
Before you decide to file for Chapter 7 bankruptcy, consider how it could affect other people on your credit accounts, such as family members or business partners. Once you have filed Chapter 7, you, by law, are not responsible for any of your debts that also include your co-debtor. But, bear in mind, the debt now becomes the sole responsibility of your co-debtor.
Be sure you’re acting when the time is right. The timing of your filing could be important to its success. Sometimes you may want to wait to file and in other situations you may find it better to do it as soon as you can. Find out when the correct time is for you to file for bankruptcy from a bankruptcy legal professional.
Look at bankruptcy as a chance to mature and take responsibility for your personal finances. For many people, bankruptcy is a source of guilt and feelings of worthlessness. These feelings, however, are of no benefit to anyone, and they can be detrimental to your mental health. Maintaining a positive outlook during a troublesome financial upheaval is the best way to cope with bankruptcy.
Sometimes you get overwhelmed with life and you feel as if there’s nothing that you can do about it. Apply the advice from this article to help yourself better understand filing for bankruptcy. Integrate the tips here into your financial plans and work to make a positive change in your situation.