Filing for bankruptcy is not a simple process. There are different types of bankruptcy, and the type that you choose depends upon your personal finances and the nature of your debts. Learn as much as you can about the topic before you make any decisions regarding filing. The following tips will help put you on the right path.
Laws regarding bankruptcy vary by state, so you need to find a lawyer that can walk you through the entire process and help keep your rights protected. In several cases, you can keep your car and your home, but it’s your attorney that will tell you what rights you have, what you can keep, and what you will need to surrender.
Bankruptcy is a very complicated, and scary process. Usually, anyone who applies for it is at the end of one’s rope. To help you feel more in control of things, be sure to educate yourself about the entire process before making your decision. Learn the requirements you have to meet before applying. Learn about what the process will be when you do apply. Finally, learn how your future will be affected by it after you file.
A huge mistake people make before filing for bankruptcy is maxing out their credit cards. This can lead to disaster when you file and the credit card companies might not discharge the debt. If you can, you need to stop using your credit cards at least six months before you file, and ideally for a year prior. Also, do your best to pay the minimum payments on these cards for at least six months before you file.
Always be honest with the information you give about your finances. Do not hide any income or assets or go on a spending spree before filing for bankruptcy: the court will find out and will not have a positive opinion of you.
Make sure that you know which, or your assets you will lose when you declare yourself bankrupt. While filing for bankruptcy may seem like a great way to clear the slate and start again with your finances, you need to understand that most of your assets will be seized during the process.
Before you file for bankruptcy, make sure that you hire the services of an experienced local bankruptcy attorney. Hiring a bankruptcy attorney who’s located geographically close to you will mean that you can contact him or her with ease. You will then be able to meet up with your attorney in person, in order to discuss your petition in greater detail.
Look at all of the options. Although bankruptcy can be highly damaging to your credit score when you file, it may actually help you in the future. It will remain on your credit report for ten years, but if filing for bankruptcy helps you overcome your debt now, it will be better for your credit score than making late credit card and loan payments for the rest of your life.
If you have many non-dischargeable debts, filing for bankruptcy may not be very beneficial or advisable. Non-dischargeable debts include student loans, taxes, child support payments, fraudulent debts, and alimony payments. Filing for bankruptcy will not dissolve any of those debts and will only make it harder for you to secure credit in the future.
Obviously, you see the necessity for proper planning and decision-making before you file. Should you determine that it is a wise move considering your personal circumstances, you need to consult with a lawyer who has handled many other bankruptcy cases.
