If you have considered filing for bankruptcy, you are probably stressed out and upset. It can be hard to figure out what to do and what steps you should take. Here are some smart tips that you can use to guide you through this difficult time and take the actions that are right for you.
If you are being faced with home foreclosure, wage garnishments or other situations that make it necessary to file for bankruptcy quickly, you may want to explore an emergency filing. Regular bankruptcy filings entail approximately 50 pages of paperwork and one to two weeks for an attorney to pull everything together. In an emergency filing, your attorney can file just the first 2 necessary pages and keep creditors from continuing foreclosure or garnishment proceedings. The rest of the work will be completed afterward.
Hire a lawyer. Filing for bankruptcy does not require a lawyer, but a lawyer makes the process easier. It allows you some degree of relief to know, that a professional will be handling your case. Take your time, and choose a lawyer with a lot of experience in the field.
Don’t feel bad if you need to remind your attorney about any specifics of your case. Don’t assume that he will remember something you told him weeks ago. Remember that you’re the boss. You’re paying your lawyer, so you should not be afraid to have your say. After all, the quality of your life hangs in the balance.
As tempting as it may be, do not run up credit cards right before filing for bankruptcy. Many times, people purchase expensive items, like jewelry, appliances and furniture right before they know they are going to file for bankruptcy. Most of the time, they are still going to be responsible for paying back this debt.
Before meeting with a lawyer, start compiling all of the documentation and paperwork you will need to provide an accurate picture of your finances. Gather six months’ worth of pay stubs, bank statements, bills and credit card statements. Create a list of property and assets that you own. Having this entire information ready from the beginning can save you trouble when it’s time to file.
Make certain that you comprehend the differences between Chapters 7 and 13. In Chapter 7 most of your outstanding accounts will essentially be erased. You will no longer be liable for any money that you owe to your creditors. Chapter 13 is different, though. This type of bankruptcy entails an agreement to pay off your debts for five years prior to wiping the slate clean. In order to choose the right bankruptcy option, you need to know the differences between these kinds of personal bankruptcy filings.
Filing for bankruptcy does not wipe out all of your debts. It does not stop you from having to pay alimony, child support, student loans, tax debt and most types of secured credit. You will not be allowed to file if these are the only types of debt that you have on record.
If you choose to file Chapter 13 bankruptcy, be sure that the amount of your monthly payments is within your reach. If you set a payment that is more than you can afford, you may face a court order of liquidation of all of your assets. You will lose everything by falling behind on payments.
You can take steps to hang onto your house. Bankruptcy filings don’t necessarily have to end in the loss of your home. For instance, if your home value has dropped recently, or even if you happen to hold a second mortgage, you may not necessarily lose the home. You could also check out the homestead exemption. This lets you continue living in your house, depending on whether you meet certain financial requirements.
If you lose your job, or otherwise face a financial crisis after filing Chapter 13, contact your trustee immediately. If you don’t pay your Chapter 13 payment on time, your trustee can request that your bankruptcy be dismissed. You may need to modify your Chapter 13 plan if, you are unable to pay the agreed-upon amount.
Now that you have read this article, you know that there are things you can do to ensure your financial well-being, even if you should choose to file for bankruptcy. Bankruptcy can be stressful and upsetting, but now that you have the information to make smart decisions about your actions, you can start to rebuild your financial life.