Bankruptcy can be both a relief and a stressful situation. For one thing, you need to examine your entire financial life and accept a lot of other people doing the same thing. On the other hand though, after your bankruptcy discharge, you can rebuild your finances and stop all the bill collection calls. You can make the bankruptcy process easier on yourself by keeping the following tips in mind.
Have a good look around the Internet to see what information is relevant to you regarding bankruptcy. The United States Department of Justice and American Bankruptcy Institute are two such places to look. The more you know, you can be confident you are choosing the right thing and that you are taking the right road to make sure your bankruptcy proceeds as easily as possible.
Don’t pay tax requirements with your credit cards with the thought of starting the bankruptcy process afterward, without doing your research first. Most states do not look at this debt as chargeable, and you could end up owing money to the IRS. If the tax can be discharged, so can the debt. Because of this, transferring the debt to your credit card is pointless.
Consider all options before deciding to file for personal bankruptcy. Look into other options, such as consumer credit counseling. Your credit score will be forever effected by bankruptcy, which is why you should do everything else in your power to resolve matters first.
Once the bankruptcy is complete, you may find it difficult to receive unsecured credit. If you find that to be the situation, consider requesting secured cards. By doing this, you will be letting people know that you want to fix your credit score. In time, you might be granted unsecured credit again.
If you aren’t totally honest about your assets when filing a bankruptcy petition, you could get into serious trouble. Your bankruptcy lawyer has to know every detail of your finances, whether bad or good. Never hide anything, and make sure you come up with a well devised plan for dealing with bankruptcy.
You should not have to pay for a consultation with a bankruptcy attorney. Make sure you ask lots of questions. You can meet with a few lawyers before deciding on one. Most lawyers provide a free initial consultation. Choose to file only if your lawyer has convinced you that this is the best decision. You don’t have to make your decision right after this consultation. You can take your time and check out several attorneys before making your final selection.
Be aware of recent changes, if any, in the bankruptcy code. The laws are constantly undergoing changes, so you must stay on top of them if you are going to file for personal bankruptcy correctly. To find out about these changes, you can look at your state’s legislation website or contact their office.
Be sure you know how Chapter 7 and Chapter 13 differ. Chapter 7 is the best option to erase your debts for good. All the things that tie you to creditors will go away. Filing Chapter 13 differs by requiring you to agree to a 60 month plan to repay your debts before they are totally eliminated. It’s important to know what differences come with every type of bankruptcy. This will let you find out what’s best for you.
Look at all the alternatives to bankruptcy before filing. A lawyer that specializes in bankruptcy law can help advise you of other options, such as repayment plans and reducing interest rates to relieve some of the burden. If a foreclosure is on your horizon, look into loan modification plans. The lender wants their money, so they may be willing to forgive some fees, change the loan term or reduce interest as ways of assisting you. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
When it comes to filing for bankruptcy, there are both positives and negatives. Regardless of your reason for filing, be aware information is the closest friend you have during the entire thing. The tips laid out here will help you cope with bankruptcy in an easier manner. Utilize these tips and let them guide you towards a stress-free financial future.