The economy is looking bad looking these days. The result of a tough economy leads to people are losing their jobs and falling into debt. Debts result in bankruptcy, which can seem to be a terrible thing.
Don’t use a credit card to pay off your taxes before filing for bankruptcy. Most of the time, you cannot discharge this debt. As a result, you will owe the IRS a lot of money. If the tax has the ability to be eliminated, the debt can be too. So, in short, do not use your credit cards to pay off debts right before you file for bankruptcy.
If this is the case for you, then learn about the laws where you live. Each state has their own set of rules regarding bankruptcy. For instance, some states protect you from losing your home in a bankruptcy, but not in others. You should be familiar with the laws before filing.
The person you choose to file with needs to know both the good and accurate picture of your financial condition.
Be sure you’re doing what’s right before you file for bankruptcy. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Bankruptcy leaves a permanent mark on your credit history, so before you take such a large step, you want to exhaust all other options so that the future effects on your credit history are as minimal as possible.
Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask him or her anything you want to know. Most attorneys offer free consultations, so talk to a few before making your decision. Only make a lawyer if you have met with several attorneys and all of your concerns and questions have been addressed. You don’t need to decide what to do right after the consultation. You can take as much time for consulting with different lawyers.
Before making the decision to file for bankruptcy, make sure that a less-drastic solution isn’t more appropriate. For instance, you may want to consider a credit counseling plan if you have small debts. You may have the ability to negotiate much lower payments, but be certain to get any arrangements with creditors in writing.
Although you can find many bankruptcy attorneys listed in your local Yellow Pages or online, it’s best if you can find one through the personal recommendation of a friend, family member or acquaintance. Don’t be taken in by some fly-by-night company that exists only to profit from the suffering of others. Check out any lawyer you are considering thoroughly before engaging him or her.
Make sure you meet with a licensed attorney rather than a paralegal or assistant, as these people are not allowed to provide legal advice.
Unsecured Debt
If you’re going to file bankruptcy, you need an attorney. You may not know everything you need to know in order to have a successful outcome of your case. Your lawyer will make sure that the filings are correct and help you navigate the complex process of filing for bankruptcy.
Consider if Chapter 13 bankruptcy. If you are receiving money on a regular basis and your unsecured debt is under $250,000, Chapter 13 may be right for you. This lasts for three to five years and after this, in which you’ll be discharged from unsecured debt.Keep in mind that missed payments will trigger dismissal of your whole case to get dismissed.
In order for this to succeed, your car loan must be one with high interest, have a higher interest loan for it as well as a consistent work history.
Learn the differences between Chapter 7 and Chapter 13 bankruptcies. Should you choose Chapter 7, your total debt load will be erased. All happenings with creditors will disappear. Chapter 13, on the other hand, involves a five year payment period before any remaining debts are cancelled. It’s imperative that you know the differences among the various categories of bankruptcy so that you are able to choose the wisest one for you.
Know your rights that you have as you file for bankruptcy.Some debtors will tell you your debt with them can not be bankrupted.Only a few debts, like student loans or child support, are ineligible for bankruptcy. If your creditors are telling you any other kind of debts cannot be cancelled, check the bankruptcy laws in your state or consult an attorney.
Make sure you file a bankruptcy claim. Timing is very important when it comes to personal bankruptcy cases.In certain situations, it is better to file immediately, but other situations will warrant you waiting. Speak to a bankruptcy lawyer about when the ideal timing is for your personal situation.
Find out more about Chapter 13. 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. Lasting anywhere from three to five years, this plan will allow you to be discharged from unsecured debt. Missing a payment under these plans can result in total dismissal by the courts.
Bankruptcy is a difficult time that always leads to lots of other physical and emotional issues. To have a reliable and trustworthy guide through the process, look into securing a good lawyer. Do not choose your attorney based on cost. It is not be necessary to hire a costly attorney; just make sure he or she is qualified to handle your case. Make sure people in your referrals. You might want to visit a court hearing to see how an attorney handles his case.
Bankruptcy affects people from all walks of life. If you are lacking a steady income, and are facing mounting bills, there are still steps you can take to help avoid bankruptcy. This article has likely given you some ideas on how you can protect yourself from having to file for bankruptcy. Best of luck to you.
Make sure you understand your rights as you file for bankruptcy. Some debtors will try to tell you your debt with them can not be bankrupted. Only a few debts are immune to bankruptcy. Taxes, student loans and child support would be the major ones. If a debt collector tells you this false information, seek the advice of your bankruptcy attorney. You may also want to report the bill collector to the attorney general’s office.