Having Financial Issues? Have You Considered Bankruptcy?
Posted at by PConran on category BankruptcyPersonal bankruptcy–the process can be complex and confusing. Because of the various types of claims out there, and also the different ways in which you can approach filing, your particular situation will be personal to you. Learn as much as you can about the topic before you make any decisions regarding filing. This article will give you some of the important facts about bankruptcy.
Knowledge is power when you’re considering bankrupcy; there are many websites available to help you. The United States Some valuable resources include the U.S. Dept of Justice and American Bankruptcy Institute. By having more knowledge, you can make the right decision, as well as be sure you are ensuring that your personal bankruptcy case goes smoothly.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. Bear this in mind; if the tax can be discharged, then the debt can be as well. If you live in an area where tax can be discharged through bankruptcy, financing your tax bill is pretty pointless.
If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. Leave your retirement accounts untouched unless there is absolutely no other alternative. 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.
If you are seriously thinking of filing bankruptcy, make sure that you contact an attorney. Having a lawyer on your side is the best way to avoid mistakes and bad decisions. A lawyer that specializes in bankruptcy can make sure you are following the correct procedures in your filing.
Before you decide to file bankruptcy, be sure to check for any new laws that may apply to your case. It can be tough to keep up with them on your own, and because they change often, a bankruptcy attorney can help you keep track for the sake of your filing process. All of these changes will be addressed on the state’s legislative site. You can also contact them directly by phone or office visit.
Check into less drastic solutions prior to declaring bankruptcy. If your debt is relatively low, you may be able to manage it with credit counseling. You can also talk to creditors and ask them to lower payments, but be sure to get any debt agreements in writing.
Filing for bankruptcy should not be done on a whim. You may qualify for alternatives such as debt repayment plans or interest rate reductions. Ask your bankruptcy attorney about these options. If you are facing foreclosure, consider a loan modification plan. Your creditors will be willing to work with you to allow you to pay off your debts. They may be able to take late fees off of your account, cut down your interest, or even extend the loan’s repayment period. At the end of the day, creditors want to get paid, and sometimes a debt repayment plan is preferable to dealing with a bankrupt debtor.
Filing bankruptcy under Chapter 13 means you can still get a loan for a car or a mortgage. It’s a bit more difficult, though. Normally, the trustee assigned to your bankruptcy must approve any new loan. Document your budget to prove that you’re going to be able to make the payments. The odds are also good that you will be asked exactly why you’re purchasing a new item. Make sure you have a good reason.
Bankruptcy is not a decision to be taken lightly. If you feel that bankruptcy best suits your current financial position, then ensure you retain an experienced attorney who can help you.