Is Personal Bankruptcy The Right Choice For Me?
Posted at by PConran on category BankruptcyThe economy is terrible today. Because more people are out of work, more people are also falling into debt. Being unable to pay your debts will eventually lead to bankruptcy, which is the last hope for many people. This article can help you or someone you care about if bankruptcy is a consideration.
When you feel certain that you must file for personal bankruptcy, refrain from squandering your life savings to pay off unsecured debt. Do not tap retirement accounts unless there is 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.
It is important to list all your assets and liabilities during the bankruptcy proceeding. Failure to do so will only cause you problems in the end. Whomever you plan to use should know a lot about the finances that you have, both the good and the bad. Do not hold anything in secret and create a strategy on how you will deal with the things you are facing.
There is hope! When you file for bankruptcy you may be allowed to recover property like your car, electronics or jewelry that might have been repossessed. Any property repossessed within 90 days before filing bankruptcy, may be able to be returned to you. A qualified bankruptcy attorney can walk you through the petition process.
Don’t ever pay a bankruptcy attorney for a consultation, and ask a lot of questions. You can meet with a few lawyers before deciding on one. Most lawyers provide a free initial consultation. Only make your decision if all your questions and concerns are adequately addressed. You do not have to give them your decision right after the consultation. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.
Think carefully about your different options before filing for bankruptcy. If your debts are really not overwhelming, you may find the assistance you need by consulting a consumer credit counselor. You could even negotiate for lower payments. However, you should ensure that you always obtain a written record of all the changes to your debt that you’ve agreed to.
Make sure that you understand the difference between Chapter 13 bankruptcy and Chapter 7 bankruptcy. If Chapter 7 is what you file, your debts will get eliminated entirely. All creditor relationships will be severed. If however you enter Chapter 13, you will go into a five year repayment program prior to your debts dissolving entirely. To make the wisest choice, you will need to understand the consequences of each of these two options.
Protect your house. Filing for bankruptcy does not guarantee that you will lose your house. You might be able to keep your home, contingent on certain factors, such as your home decreasing in value or having a second mortgage. You should also examine the possibility of taking a homestead exemption. This could apply if your income falls below the financial threshold.
Think about any co-debtors you have prior to filing for Chapter 7 bankruptcy. Once you file for Chapter 7 bankruptcy protection, you no longer have legal responsibility for debts that you and any co-signers originally agreed to. However, if you had a co-debtor, they will be required to pay the debt.
It is possible to get an auto loan or mortgage during the repayment period for Chapter 13 bankruptcy. It’s a bit more difficult, though. You will have to get this loan approved by your trustee. When meeting with the trustee, bring a budget which shows that you will be able to afford the payment on the loan you are trying to get. Also, be sure you can provide an explanation as to why this purchase is necessary.
Although the economy is slowly picking up, there are still many people left without jobs and a decent wage. Even when your financial situation is not producing enough income, there are some things one can do in order to avoid bankruptcy. Hopefully, this article has given you information that you can use to avoid having to file for bankruptcy. Put this advice to work for you starting today.