Understanding Why Bankruptcy Is Not The End Of The World

July 22, 2013

TIP! Don’t be afraid to remind your lawyer about important aspects of your case. Don’t assume that he’ll remember something from a month ago; tell him again.

The decision to file bankruptcy is difficult, but sometimes unavoidable. It is always best to go forward, armed with the best information and assistance you can find. You need to know what you are up against. Keep reading to learn some valuable tips from someone who has stood in your shoes.

Familiarize Yourself

TIP! If bankruptcy is an option for you, secure the services of an attorney. Bankruptcy can be highly confusing and stressful, and you need an unbiased partner who can help simplify the process.

If you are in a position where you are unable to pay your debts, bankruptcy may be the only option for you. When you are faced with this issue, begin to familiarize yourself with your state’s laws. Each state has its own set of rules regarding bankruptcy. Your house is safe in certain states; however, in other states, it isn’t. Familiarize yourself with the bankruptcy laws of your state prior to filing.

TIP! Consider other alternatives before filing for bankruptcy. If your debt is relatively low, you may be able to manage it with credit counseling.

Do not attempt to pay your taxes with your credit cards and subsequently file for bankruptcy. You will find few states that discharge this kind of debt. You may also wind up owing a lot of money to the IRS. Transferring the debt to another medium (e.g. a credit card) won’t magically make a tax debt discharagable, either. Just because your credit card could be discharged in bankruptcy does not mean you should use it.

TIP! Know the differences between Chapter 7 and Chapter 13 bankruptcy. Chapter 7 eliminates all debts.

Be sure to remind your lawyer if it seems that some details of your situation are forgotten. You should not take for granted that your lawyer will remember every important detail that you have have told him earlier without a reminder. Speak up. This is your life, and your future depends on it.

TIP! If you are making more money than you owe, bankruptcy should not even be an option. Understand that while declaring bankruptcy will eliminate many of your debts, you will have difficulty obtaining credit and will pay more in interest for the credit you do receive for at least seven years.

Nobody really wants to file for bankruptcy but it sometimes is just something they have to do. You should now have some excellent advice from people who have personally struggled with the bankruptcy process. It will be a little easier to face bankruptcy after learning from people who have experienced it.