Gaining Control Of Your Finances After A Bankruptcy
Posted at by PConran on category BankruptcyDebt is one of the scariest things to live with. In a quick amount of time, you can go from being in a tiny bit of debt to a situation that suddenly spirals out of control. Although it is a long and difficult process, there are ways to get through it unharmed and restore your finances. The article below offers you some great tips on filing for bankruptcy if your financial situation has become out of control.
When people owe more than what can pay, they have the option of filing for bankruptcy. When you get into this situation yourself, your first step is to familiarize yourself with your local bankruptcy regulations. Bankruptcy laws vary from state to state so it is important to do your research. Your home and other major assets may be protected in your state, while they are vulnerable in other states. See to it that you understand the bankruptcy laws in the area that you live prior to filing.
Do not consider paying off tax debt with credit cards and filing for bankruptcy afterward. It won’t work. In many parts of the country, you cannot get this debt discharged, and in the end you will be left owing the IRS a big sum of money. One thing that you should remember is that if your tax is dischargable, your debt will also be dischargeable. Therefore, you should not pull your credit card out for purchases if it is just going to be discharged during the bankruptcy.
It’s not uncommon to learn soon after bankruptcy that you are unable to get an unsecured credit card easily. If this happens to you, think about applying for a couple of secured credit cards. This at least shows you are making an honest attempt at reestablishing your credit worthiness. It will take time, but when creditors see a pattern that satisfies their need to see your good faith with payments, you will then be able to apply for unsecured cards.
Protect your house. Filing for bankruptcy does not always mean you will end up losing your home. It is entirely possible that you will be able to keep your home. This is dependent upon the your home’s value and whether or not you have taken a second mortgage. You may also want to check out the homestead exemption because it may allow you to keep your home.
Make sure you know how to differentiate between Chapter 13 and Chapter 7. Take the time to find out about each one online, and look at the advantages and disadvantages of each. If there is anything that you don’t understand, go over it with your lawyer so that you can make the best decision.
Consider 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. Not only can you repay your debts through consolidation, personal property can be kept, as well as real estate. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. Keep in mind that missed payments will trigger dismissal of your case.
Don’t just assume bankruptcy is the right option, especially if you have not considered others. Credit counseling is one option you should consider. There are many different non-profit companies that can help you. With their assistance, you can reduce the payments you have to make and even get some of the interest removed from your debts. You make payments to them and they pay your creditors.
Sometimes in life things just happen which are out of your control. The article above has some powerful suggestions to get things back in control and manage the issues you face when filling for bankruptcy. Incorporate the advice given and see how it can make a huge change in your life.