Personal Bankruptcy Tips You Must Not Ignore

June 9, 2013

TIP! Many people need to file for bankruptcy when they owe more money than they can pay off. If this sounds familiar, you should read up on the bankruptcy laws in your state.

Declaring bankruptcy is anything but easy. For example, there are several types of bankruptcies. Each type depends on several factors including your income as well as your debts. Prior to filing your petition, you really need to gain an understanding of how personal bankruptcies work. The following tips will help put you on the right path.

TIP! Try to make certain you are making the right choice prior to filing your petition. Avail yourself of other options, including consumer credit counseling, if they are appropriate for your situation.

Learn as much as you can about bankruptcy by going to informational websites. The United States Department of Justice, the American Bankruptcy Institute and the National Association of Consumer Bankruptcy Attorneys, all provide valuable information. By having more knowledge, you can make the right decision, as well as be sure you are ensuring that your personal bankruptcy case goes smoothly.

TIP! Be sure to hire an attorney before you embark upon filing for personal bankruptcy. Having a lawyer on your side is the best way to avoid mistakes and bad decisions.

If you are considering paying your taxes with credit cards and turning around and filing bankruptcy–they are on to you. In most states, this debt won’t be discharged, and you could end up owing the IRS a whole lot more. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. Therefore, you have no reason for use of a credit card, if the amount is to be discharged in due process of the bankruptcy.

TIP! Learn of new laws prior to deciding to file for bankruptcy. Bankruptcy laws are in constant flux, so just because you knew the law last year doesn’t mean that the laws will be the same this year.

It should go without saying, but refrain from lying in your bankruptcy filings. Withholding or lying about certain information can seriously worsen your financial situation. It could lead to being unable to file for bankruptcy or even legal trouble.

Obtain Unsecured

TIP! If you are making more money than you owe, bankruptcy should not even be an option. Although you may see bankruptcy as a free pass to eliminate your debt, if you can slowly whittle away at your debt with your income, it will be much better than killing your credit score with a bankruptcy filing.

It can be difficult to obtain unsecured credit once you have filed for bankruptcy. If you find that to be the situation, consider requesting secured cards. This demonstrates to creditors that you are making a good faith effort to repair your credit. In time, it may be possible for you to obtain unsecured cards.

TIP! Remember that filing for Chapter 7 personal bankruptcy will not just affect you. Think about the effect it will have on business associates, friends and family or anyone else who may be a co-signer with you.

Clearly, filing for bankruptcy takes a great deal of thought and consideration in advance. Once you have determined that filing for personal bankruptcy is the right choice for a you, engage an experienced and respected lawyer. With the help of a good lawyer, you can make your way through the process easily and secure in the knowledge that you are doing it right.