Deciding If Personal Bankruptcy Is Right For You – Issues To Consider
Posted at by PConran on category BankruptcyIf you were unfortunate enough to have your property repossessed by the tax man, you should probably consider bankruptcy. Bankruptcy can wreak havoc on credit, but it may be the only way out of your situation. Check out the following tips to see what filing for bankruptcy entails and what can happen if you do.
Before making the decision to file for bankruptcy, be sure to do some research and learn all you can about the subject. There are many websites available that offer this information. The United States Department of Justice, American Bankruptcy Institute, along with many other websites can provide you with the information you need. The more you know about it, the better you are able to make the best decision for your situation and to make sure that the bankruptcy proceedings move forward with minimal setbacks.
If you suspect that bankruptcy filing may be a reality, don’t try to discharge all your debt in advance by emptying your retirement or saving accounts. Do not tap retirement accounts unless there is no other alternative. Although you may need to tap into your savings, you should not use up all of it right now and jeopardize the financial security of your future.
Always be honest and forthright when it comes to your bankruptcy petition. You can lose the right to file bankruptcy now or in the future if you try to withhold information about your assets and income. So it is critical that you disclose everything honestly to to avoid that and any other penalties the trustee might impose if he discovered your attempt to hide information from the court.
Use a personally recommended bankruptcy attorney instead of one found through the Internet or phone books. To handle your bankruptcy, you need a trusted attorney, not a shady one that is out to take your money.
Don’t try to hide anything if you are filing for bankruptcy, as this will hurt you in the long run. Whomever you use to file with must know everything there is to know about your finances, both good and bad. Don’t hold anything back and formulate a smart strategy to deal with the reality you are facing.
Be certain that you can differentiate between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 bankruptcy is intended to wipe out all outstanding debts. All of your financial ties to the people you owe money to will disappear. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. You need to be aware of the pros and cons of each type of bankruptcy so you can correctly select the best choice for your situation.
Before filing for bankruptcy ensure that the need is there. Some people have great luck with handling debt with debt consolidation, which means taking out only one loan to pay off many loans. Bankruptcy cases are long, anxiety-filled experiences. It will have a major effect on your credit as time goes on. Personal bankruptcy should be undertaken as a last resort when no other workable options are available to you.
Once you have completed the bankruptcy filing, you should take time to do something you enjoy. Bankruptcy is a stressful process: you will have to go over your bad financial decisions and perhaps feel ashamed about your decision. This stress could morph into clinical depression, if you fail to adequately address the problem. Life will get better; you just need to make it through the bankruptcy process.
Know the rules of personal bankruptcy prior to petitioning. There are some clauses within bankruptcy that could cause you upsets. If the regulations are not followed, your case may be subject to a dismissal order. It is important to learn the bankruptcy code before filing bankruptcy. Doing this can make the process simpler.
We would like to reiterate that you always have the option of filing for personal bankruptcy. But, because of the effect it has on one’s credit, it shouldn’t be the first choice. Protect your assets and avoid even more stress by learning as much as you can before you decide to file.