Bankruptcy effects a myriad of people each with different financial situations. People who declare bankruptcy usually have no other options left available. If you’re in this boat, read on for some helpful advice.
Do not even think about paying your taxes with credit and petitioning for bankruptcy right after. Generally, this type of debt is not covered by bankruptcy filing, and you will still have a large debt owing to the IRS. Generally speaking, debt incurred to pay taxes and the tax bills themselves are treated the same in a bankruptcy. So using your credit card to pay off your tax obligations, then filing for bankruptcy, can actually hurt you instead of help you.
Always remind your lawyer of specifics that are important to your case. Don’t just assume that the attorney will remember it automatically. This is your future in their hands, so don’t be scared to mention it.
Try to get a bankruptcy lawyer that your friends recommend, as opposed to someone that you find from the Internet or yellow pages. Bankruptcy attracts a lot of fly-by-night firms that take advantage of desperate people, and a word-of-mouth recommendation makes it more likely that your bankruptcy will go smoothly.
Do not despair, as it’s not the end of the world. Filing for personal bankruptcy may possibly enable you to reclaim your personal property that have been repossessed, like your car, electronics and jewelry items. You should be able to get your possessions back if they have been taken away from you within 90 days before you filed for bankruptcy. Consult with a lawyer that can walk you through the filing process.
Safeguard your home. Filing for bankruptcy does not guarantee that you will lose your house. It may be possible to keep your home if the value has depreciated, or there is a second mortgage. Check to see if you pass the requirements necessary to file for a homestead exemption.
It is imperative that you know for sure that bankruptcy is the option you need. Consolidation could be the avenue you need to get your finances back in order. Going through a bankruptcy is a long and stressful process. Credit will be much harder for you to come by after you file for bankruptcy. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.
Check into less drastic solutions prior to declaring bankruptcy. For example, you want to look into credit counseling. This is the best option for small debts. 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.
It is possible to obtain new vehicle and home loans while a Chapter 13 case remains active. However, the process of approval is a bit more stringent. You will need to go through various hoops in order to be approved for any new loan type. To show that you are responsible and prepared for the undertaking of a new loan, flesh out a full budget. Also, be sure you can provide an explanation as to why this purchase is necessary.
Once you realize you are headed towards bankruptcy you will need excellent advice on what are the correct steps to take. The process will be much simpler if you are well-informed. Much of the information you need was provided to you in the article above.
Do you want to pay off your debt and be financially free for the first time in a long time? If that’s you, the most critical factor to make it come true is to adjust your mindset. Orrin Woodward, renowned personal development expert is one of the most highly regarded authority in establishing proper culture and balance to build stronger, sustainable, and repeatable profitable enterprise from home. He is also one of the co-founders of the LIFE business.