Bankruptcy: What To Consider When Filing

July 17, 2013

TIP! Individuals often seek to file for personal bankruptcy protection if their debts exceed their ability to repay them. If you find yourself going through this, you should know all about the laws that are in your state.

There is no doubt that the current economy is a challenging one. Because of the state of the economy, a lot of people have been let go from their jobs and have acquired debt. The unfortunate result of this is that more and more people are filing for personal bankruptcy. Learn how to get through a bankruptcy filing by reading this article.

TIP! If you suspect that bankruptcy filing may be a reality, don’t try to discharge all your debt in advance by emptying your retirement or saving accounts. Retirement accounts should never be touched if it can be helped.

Once a person’s debts outstrip his or her ability to repay them, bankruptcy may be the only option left. If this is your case, you should do some research about bankruptcy laws in your state. The laws governing bankruptcy vary from state to state. Some states protect your home, and others do not. Do you research about legal ins and outs in your state before you begin the bankruptcy process.

TIP! Be sure to bring anything up repeatedly if you are unsure if your lawyer is focusing on it. Never assume that they can remember all details without reminders.

Think through your decision to file for bankruptcy carefully before going ahead with it. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation. Bankruptcy will leave a permanent scar on your credit report and before you take this huge step, you should search through every available option first, to help try and limit the damage to your credit.

TIP! Look for a bankruptcy lawyer that comes from a personal recommendation instead of someone random on the Internet or in the yellow pages. There are a number of companies who may take advantage of your situation, so always work with someone that is trustworthy.

When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. Do not tap retirement accounts unless there is no other alternative. Though you may need to use a bit of your savings, try hard to maintain some of your reserves so that you have some degree of flexibility going forward.

TIP! Learn the differences between Chapter 7 and Chapter 13 bankruptcies. Should you choose Chapter 7, your total debt load will be erased.

While some new jobs are beginning to pop up, many people are struggling to find decent income; in fact, many people searching for any job. If you are unemployed, or lack a regular income, you can still take steps to avoid having to file for bankruptcy. Hopefully, you are now aware of how to get yourself or your loved ones on the right track in order to avoid bankruptcy. Good luck to you.