Tips For Chapter 13 And Chapter 7 Bankruptcy And Property
Being in debt is far from fun, and it is even downright scary at times. In some cases, what started as a manageable amount of debt turns into an insurmountable challenge. Although it is a long and difficult process, there are ways to get through it unharmed and restore your finances. The piece that follows does offer some guidance about how to handle bankruptcy when your burden becomes to much to bear.
Don’t look at bankruptcy as a first step. Look at all the other options you may have first. You have other options available like consumer credit counseling services. Your credit score will be forever effected by bankruptcy, which is why you should do everything else in your power to resolve matters first.
Make sure you are always providing honest documentation whenever you have to file for personal bankruptcy. You may be tempted to try to hide income and personal assets from discovery, but doing so often leads to major complications, monetary penalties and the possibility that your case will be thrown out of court.
There are two types of bankruptcy filing, Chapter 7 and Chapter 13 so make sure you know the differences. Chapter 7, for example, will wipe away every one of your outstanding debts. Any debts that you owe to creditors will be wiped clean. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. It is worth while to take your time to research both types of bankruptcy to decide which option works best for you, and your financial situation.
A lot of bankruptcy attorneys will let you have a consultation, so try several out. Never settle for speaking with a paralegal or an assistant. They are not trained, nor allowed, to pass on legal advice. Seeking out different attorneys is all part of the process until you find someone that you can trust.
Consider Chapter 13 bankruptcy, if you chose to file. Chapter 13 bankruptcy is a good choice for people whose unsecured debts amount to lower than $250,000 and who receive a regular income. Filing for this type of debt will ensure that you can hold onto your real estate and personal property, and will let you develop a consolidation plan to pay off your debts. The length of the plan is generally up to five years, and when this is over, you will be free of unsecured debt. However, if you miss even one payment, the court will dismiss your entire case.
If you are earning enough to cover your bills, don’t file for bankruptcy. Filing for bankruptcy can really damage your credit in the long run, by staying on your report for up to ten years.
If you are moving forward with a Chapter 7 bankruptcy, you need to learn how that can negatively affect anyone who shares loans with you. A Chapter 7 bankruptcy will relieve you of your legal responsibility to pay any joint debts. But, creditors will ask for the money from your co-debtor.
Make sure you act at an appropriate time. Timing is critical, particularly when it comes to filing for bankruptcy. In certain situations, you should file right away, but other situations will warrant you waiting. Find out when the correct time is for you to file for bankruptcy from a bankruptcy legal professional.
Don’t drag your feet when it comes to filing bankruptcy. Some people will just ignore their outstanding debts, hoping that someone or something will come and save them, but this never ends well. Debt can become a big problem rapidly, and if you fail to handle it, you can face foreclosure or garnishment of wages. When you make the connection that your debt level is too high, contact an attorney that specializes in bankruptcy as soon as possible, to see what can be done.
Before you even consider filing for bankruptcy, familiarize yourself with the laws surrounding this process. For instance, somebody cannot transfer assets from a filer’s name up to a year after they file. In addition, it is unlawful for the filer to increase the amount of debt they are carrying on their credit cards right before they file.
If you are planning to file for bankruptcy in the immediate future, you should refrain from taking out cash advances via your credit cards. This is considered fraud, and even after bankruptcy you can be forced to pay all of that money back to the credit card company.
Before you file make sure that you are not doing anything to bring yourself in debt any more. The period before your filing is not the time to run up additional debts. When looking at your situation, a judge will take both your past and current credit history into consideration. You want to show them that you are doing everything you can to make your situation better.
Contrary to popular belief, you won’t necessarily lose your assets if you happen to file for bankruptcy. You get to keep your personal property. Things like jewelry, clothes, and electronics are included in this category. The personal items that you are allowed to keep will depend on your home state’s individual bankruptcy laws, your personal financial situation and the specific bankruptcy that you are filing for.
If you are going to declare bankruptcy, hire a lawyer first. An attorney can offer valuable advice and help to simplify an extremely complex process. An attorney can also complete the required paperwork and provide advice as you go through the process.
There are lawyers who maintain a telephone service meant to field calls from creditors attempting to contact debtors who have filed for bankruptcy. Creditors can receive confirmation that you are indeed filing for bankruptcy protection from them if they give that number a call. This will prevent them from calling you in the future.
Sometimes, financial crises just take place in your life and you do not have the chance to do much about them. Now you can see a few different ways that you can gain control over your finances if faced with personal bankruptcy. Incorporate the advice given and see how it can make a huge change in your life.