Looking To File For Personal Bankruptcy? Check Out These Tips!
Posted at by PConran on category BankruptcyBankruptcy is a tough decision for people to make, but in many situations, it is the correct choice. If you are thinking about filing for bankruptcy, it’s best to be armed with as much information as possible. Keep reading for some solid wisdom from people who have themselves gone bankrupt.
Ask yourself if filing for bankruptcy is the right thing to do. You have other options available like consumer credit counselling services. Bankruptcy leaves a permanent mark on your credit history, so before you take such a large step, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
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. Retirement accounts should never be touched if it can be helped. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.
It’s not uncommon to learn soon after bankruptcy that you are unable to get an unsecured credit card easily. If this is so, apply for a secured card or two. This will be a demonstration of the seriousness with which you view rebuilding your credit rating. After some time passes they may be willing to offer you unsecured credit.
You may have heard bankruptcy referred to differently, either as Chapter 7 or Chapter 13. Learn the differences between the two before filing. Chapter 7, for example, will wipe away every one of your outstanding debts. Your former ties with creditors will cease to exist. Chapter 13, on the other hand, involves a five year payment period before any remaining debts are cancelled. 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.
Consider filing for Chapter 13 bankruptcy. If you are receiving money on a regular basis and your unsecured debt is under $250,000, you may be able to file Chapter 13 bankruptcy. You can secure your home under Chapter 13 and pay your debts with a payment plan. Typically, any plan you develop will last around 3-5 years. Afterwards, any remaining unsecured debts will be discharged. Remember that missing a payment to the plan will result in your case being dismissed.
Think about any co-debtors you have prior to filing for Chapter 7 bankruptcy. Once you have filed Chapter 7, you, by law, are not responsible for any of your debts that also include your co-debtor. But, creditors will ask for the money from your co-debtor.
Know the rights that you have as you file for bankruptcy. It is not unusual for creditors to claim that their debt is not able to be discharged. There are only three main classes of debts that are non-dischargable: taxes, child support and student loans. If a debt collector tells you this false information, seek the advice of your bankruptcy attorney. You may also want to report the bill collector to the attorney general’s office.
Don’t wait till it’s too late to file for bankruptcy. It is a big mistake to avoid financial problems, thinking they may go away on their own. Debts can get out of control fast. If you’re not taking care of these debts, you may be getting into trouble like wage garnishment. As soon as you know that you are too far over your head, make the move to call an attorney skilled in bankruptcy court, to weigh your options.
Write down everything that you owe. You will need this list when you file, so it is important for it to be as compete as possible. Always go through your statements and get exact numbers. Do not rush through this process; if you want the amounts discharged, you have to get those numbers right.
Nobody really wants to file for bankruptcy but it sometimes is just something they have to do. You should now have some excellent advice from people who have personally struggled with the bankruptcy process. By learning from others that have been in the same situation, it will make it easier on you in the long run.