Personal Bankruptcy Tips For A Fresh Start
Posted at by PConran on category BankruptcyPersonal bankruptcy–the process can be complex and confusing. Different bankruptcy filing types are available, and the right one for you will depend on the kinds of debts you have and your overall financial picture. Prior to filing your petition, you really need to gain an understanding of how personal bankruptcies work. This information may point you in the right direction.
Try going to a personally recommended bankruptcy lawyer instead of using a phone book or the Internet. There are so many dime-a-dozen companies out there who make it a practice of preying on financial desperation. You need to make sure your bankruptcy goes smoothly, so find someone you know you can trust.
Think about all your options before pulling the trigger. Find out if you can receive a reduced interest rate or altered repayment plan instead of bankruptcy filing. Loan modification plans can help if you are dealing with foreclosure. 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. Creditors want to recoup the most money possible from debtors, and they can often get more through debt repayment plans than bankruptcy procedures.
Remember that your Chapter 7 filing may affect other people in your life as well. When you file under Chapter 7, you will no longer be legally responsible for any debts that were signed by yourself and a co-debtor. Any co-debtor may well be held responsible for paying off the total remaining amount of the debt, though.
Make sure you understand your rights as you file for bankruptcy. Don’t take a debt collectors word for it simply because they tell you that you can’t have many or all of your debts erased by bankruptcy. There are only three main classes of debts that are non-dischargable: taxes, child support and student loans. If a bill collector attempts to say their bill cannot be discharged, look it up. If they are wrong, report them.
Decide right up front that you are not going to feel embarrassed or ashamed about needing to file bankruptcy. Many people feel guilty, embarrassed and unworthy when dealing with bankruptcy. Wallowing in these emotions benefits no one, and only serve to harm your own mental health. Keep a positive state of mind to deal with your tough financial situation.
Make sure you know the bankruptcy laws before filing your petition. Your case may be rife with issues due to pitfalls inherent in codes regarding personal bankruptcy. It is even possible for your whole petition to be thrown out of court due to errors being made. Do as much research as possible about bankruptcy before you file. Doing this can make the process simpler.
Consider all of your options before filing for bankruptcy. Have you been through credit counseling first? Many different non-profit entities exist that can assist you without charging you any fees. They will liaise with those you owe money to and try to get better payment options opened to you. They collect payments from your and then pay the creditors.
Bankruptcy will erase debts. Don’t create any new debts before filing for it. That is considered fraudulent behavior, and you can still have to pay the credit card back, bankruptcy or no.
Be cautious if you are planning to pay off any of your debts before you file for bankruptcy. Bankruptcy rules generally outlaw repayment of creditors in the 90 days leading up to a bankruptcy filing, a period that is extended to one year when it comes to payments made to family members. Know what the laws are prior to making any payments.
You likely now understand that bankruptcy is something that should be undertaken carefully and with great deliberation. If you decide bankruptcy is right for you, take the proper precautions. This could be a new beginning and a clean slate for you.