Things To Look For When You Think It Is Time To File For Personal Bankruptcy
Posted at by PConran on category BankruptcyBankruptcy can be both a relief and a major stressor. You will be forced to expose your financial life to outsiders and you will have to sift through all of your assets and obligations. The relief is that your phone will stop ringing with harassing phone calls from debt collectors, and you can begin to rebuild your credit. This article will give you some great tips to help ease the bankruptcy process.
You should check with the personal bankruptcy resources available online to educate yourself thoroughly before you begin the process. The United States Justice Department, the ABI (American Bankruptcy Institute), as well as the NABCA (National Assoc. Consumer Bankruptcy Attorneys) are excellent sources of information. The more information you have, the more confident you can be about any decision you make and you will know that you are doing the best thing possible for your situation.
Before you proceed with your personal bankruptcy case, review your decisions to be certain that the choice you are making is the right. You have other options available like consumer credit counselling services. Bankruptcy will be on your credit report and affect your credit score for many years to come, so it is a decision that should not be taken lightly. Try to use it as a last resort.
When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. You should not use your retirement savings unless the situation calls for it. You may need to withdraw some funds from your savings account, but don’t take everything that is there as you will be bereft of any financial backup if you do.
Do not hesitate to remind your lawyer of any details regarding your case. Don’t assume that he’ll remember something from a month ago; tell him again. Don’t fear speaking up since it affects your case and future.
It is important to protect your home when filing bankruptcy. Filing for bankruptcy will not always result in losing your home. You can still keep your home, it just depends on your specific situation and the value of your home. You should also examine the possibility of taking a homestead exemption. This could apply if your income falls below the financial threshold.
Find out if you can use Chapter 13 bankruptcy, as it may help you better than the other laws. Chapter 13 bankruptcy is a good choice for people whose unsecured debts amount to lower than $250,000 and who receive a regular income. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. It usually takes three to five years to fulfill this plan. When the time is up, you’re unsecured debts will be discharged. Remember that you must make every payment. Missing even one could cause the court to dismiss your case.
Although the entire process can be stressful, do not allow the stress to take over. Filing for personal bankruptcy can be very stressful for the debtor. That stress can cause depression, if you don’t take care to avoid it. Once the process if over, your life will improve.
Filing for Chapter 13 bankruptcy will not prevent auto loans or mortgages from being obtained. This is a lot harder. You must meet with a trustee to gain approval for a new loan. Draw a budget up and show how you can pay the newer loan payment. It will also be necessary to show why a new purchase needs to be made.
Be mindful of paying off outstanding obligations before you file a bankruptcy petition. Check the bankruptcy laws in your state to make sure you have not done anything in the past year to make yourself ineligible to petition for bankruptcy. You need to know the law before you decide to file for bankruptcy.
There are both benefits and harms involved, if you file for bankruptcy. Remember that whatever reason you have for taking this step, education is your best weapon during the process. This article should help you learn more about personal bankruptcy. As long as you implement these tips how you read them, you should be able to make much more sense of the process.