Solid Advice On Filing For Personal Bankruptcy

Filing for personal bankruptcy protection is an important strategy for people that have had assets, such as their vehicle, seized by the IRS. Of course your credit will be hurt when you file for bankruptcy, but sometimes this is your best choice. You can find out more about filing for personal bankruptcy, as well as the consequences of this action, by reading the information presented here.

TIP! Consider other alternatives before filing for bankruptcy. For instance, a consumer credit counseling program may be a better bet if your debts are relatively small.

Don’t use credit cards to pay your taxes if you’re going to file bankruptcy. Generally speaking, taxes are not a dischargeable debt. The delays caused by this sort of tactic could leave you owing the IRS a great deal in interest and penalties. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. So using your credit card to pay off your tax obligations, then filing for bankruptcy, can actually hurt you instead of help you.

When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. You should never touch your retirement accounts, unless you have absolutely no choice. If you have to use a portion of your savings, make sure that you save some to ensure that you are financially secure in the future.

TIP! Learn the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. Read up on the topic and familiarize yourself with the benefits and drawbacks of both variations.

Determine which assets won’t be seized before filing for bankruptcy. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. You need to compare this list to the assets you own so that you are not surprised when certain assets are seized. If you are not aware of the rules, you could be setting yourself up for a lot of stress when your most important possessions are taken in the bankruptcy.

When you do meet with a lawyer make sure that they answer all of your questions and that they do not charge you for consultation alone. Since most attorneys offer free consultations, meet with a few attorneys before deciding who to hire. Make a decision when all your concerns and questions have been addressed well by one lawyer in particular. It’s isn’t necessary to make a choice right away. If you’re unsure, don’t hesitate to talk to multiple bankruptcy lawyers.

TIP! Don’t forget to enjoy your life once your finances get fixed. Many people who undergo this process become way too stressed out.

Don’t file for bankruptcy if it is not completely necessary. Consolidation could be the avenue you need to get your finances back in order. Declaring bankruptcy is a very involved process that can cause a good deal of anxiety. It will certainly affect the credit rating that you have in the future. So, consider bankruptcy only as a last resort when you have no other choice.

As said in the beginning of the article, personal bankruptcy is always an option. Filing for bankruptcy should not be your first choice. Reading up on the right ways to handle your situation will save you a lot of headaches in the long run.