Information You Must Know Before Filing For Bankruptcy

June 23, 2013

TIP! Do not pay your taxes with credit cards that will be canceled when you file for bankruptcy. Credit card debt is handled charge by charge during bankruptcy, and in most states, tax debt cannot be discharged through bankruptcy.

Nowadays, many people have racked up huge amounts of debt. Debt continues to mount while collection phone calls continue to rise. If you find yourself in this type of financial trouble, you may want to think about filing for bankruptcy. Keep reading to see if this is a viable solution for you.

TIP! Instead of relying on random selections from the phone book or Internet, ask around and get personal recommendations. Companies are constantly popping up, claiming to help, yet only seek to profit from your misery.

When choosing a bankruptcy lawyer, your best option is to find someone who is recommended by someone you know versus someone who you find online or in the phone book. Don’t allow yourself to be taken advantage of by predatory lawyers just because you are filing for bankruptcy. It is important to find someone trustworthy.

TIP! Know the differences between Chapter 7 and Chapter 13 bankruptcy. In Chapter 7 most of your outstanding accounts will essentially be erased.

If you are seriously thinking of filing bankruptcy, make sure that you contact an attorney. Personal bankruptcies are detailed and complex processes, and you may miss something that costs you money. A personal bankruptcy lawyer will be able to help you and ensure you are doing things the proper way.

Chapter 7

TIP! Talk with your lawyer about getting lower payments for any car you wish to keep. You can often lower your payment using Chapter 7 bankruptcy.

The two main kinds of bankruptcy are Chapter 7 and Chapter 13. Make sure you understand them so you know what is best for you. The Chapter 7 variety can help you eliminate your debts almost entirely. Any ties that you have with creditors will be dissolved. A Chapter 13 filing involves a repayment plan, though. Typically, you will make a partial payment against your debts over the next 60 months before the balance of the debts is lifted. In order to choose the right bankruptcy option, you need to know the differences between these kinds of personal bankruptcy filings.

TIP! Make sure you are acting at the appropriate time. Timing is everything, especially in personal bankruptcy filings.

As you can see, there is a lot of help available if you are considering filing for personal bankruptcy. By approaching bankruptcy proceedings with a clear frame of mind, you can use the process as a valuable tool to help you rid yourself of debt and get on with your life.