Advice For Those Consumers Contemplating A Bankruptcy Filing

It is not uncommon these days for people to be drowning in debt. They are harassed by collection calls and creditors all while the bills keep piling up. If this is happening to you, then you might want to think about personal bankruptcy. Read on to learn if bankruptcy is the best decision for you.

TIP! Do not try to get clever by paying your taxes via credit card before you declare bankruptcy in an effort to dodge your tax burden. In a lot of places, the debt cannot be discharged, and you may still owe money to the IRS.

People generally mostly feel the need to get a bankruptcy filed for when they have more money owed than they can get. If this is your case, you should do some research about bankruptcy laws in your state. Bankruptcy laws vary from state to state so it is important to do your research. You may find your home is safeguarded in one state, while in another it isn’t. You should be familiar with the laws for your state before filing for bankruptcy.

Make sure you are always providing honest documentation whenever you have to file for personal bankruptcy. 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.

TIP! After you have declared bankruptcy, you may have a hard time being approved for unsecured credit. This being the case, look at secured card options.

You are going to get found out and get in trouble if you don’t disclose all your assets, so be totally honest from the beginning. The lawyer representing you when you file needs to have full knowledge of your financial situation. Divulge all of your information so that you and your lawyer can devise the best strategy for dealing with your situation.

Before declaring bankruptcy, ensure that all other options have been considered. If your debt is relatively low, you may be able to manage it with credit counseling. It is sometimes possible to negotiate smaller payment by yourself. If you do this, make sure you save a written record of debt modifications that are negotiated.

TIP! Check into less drastic solutions prior to declaring bankruptcy. If your debts are really not overwhelming, you may find the assistance you need by consulting a consumer credit counselor.

Safeguard your most valuable asset–your home. Filing for bankruptcy does not mean you have to lose your home. It is entirely possible that you will be able to keep your home. This is dependent upon the your home’s value and whether or not you have taken a second mortgage. You could also check out the homestead exemption. This lets you continue living in your house, depending on whether you meet certain financial requirements.

Find out if you can use Chapter 13 bankruptcy, as it may help you better than the other laws. If you currently have some income and don’t have more than $250k in debt, you can declare bankruptcy. By filing this way, you can hold onto your home and property, while repaying debts through debt consolidation. Expect to make payments for up to 5 years before your unsecured debts are discharged. Consider that if you even miss one payment, your case will not be considered by the court.

TIP! There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice.

You should now understand that there is more than one path to take when it comes to bankruptcy. If you approach it from just the right way and with a crystal clear, aware mind, you will experience the relief you wanted and will help you to get up again.