Personal bankruptcy–the process can be complex and confusing. Because of the various types of claims out there, and also the different ways in which you can approach filing, your particular situation will be personal to you. It is important to learn about personal bankruptcy before you make the decision to file. This information may point you in the right direction.
Before filing personal bankruptcy, consider other options. One of these choices is consumer credit counseling. Many different non-profit entities exist that can assist you without charging you any fees. They will liaise with those you owe money to and try to get better payment options opened to you. Payments are then made to the creditor via the counseling service.
If you are thinking of filing for personal bankruptcy, it is important to understand what led you to your current situation. Were you spending far too much on luxuries? Did you ever have the means to repay your debt? If you have issues with spending money on non-critical items, you may need to get help so that you will not wind up in financial trouble again after completing your bankruptcy.
Take steps to ensure your home is protected. Bankruptcy filings do not necessarily mean that you have to lose your house. Depending on whether the value of your home has decreased or if you have a second mortgage on the home, you may end up keeping it. If you meet certain criteria, you may be able to retain ownership of your home even after filing for bankruptcy.
If you cannot qualify for a Homestead Exemption when filing for Chapter 7 bankruptcy, it is possible you might also be able to do Chapter 13 too, simply for your mortgage. For some people it is a good idea to convert your Chapter 7 case to a Chapter 13; talk to your lawyer about which action to take next.
Choose an attorney that is respected in your area. When you have located a good lawyer, be sure to find out whether or not the initial consultation is free. If they do, make an appointment to see them and get all pertinent financial documents or statements together, so you will have them ready to take with you. They will surely fill you in about how to go about the entire process.
When you are filing for bankruptcy, make sure you list all of the financial information you may have. If you forget any items, your filing could be rejected. Even if it’s a small sum, make sure it is listed. Don’t forget about side jobs, loans you’ve taken out or vehicles that might count as assets.
Gain an understanding of bankruptcy law before you file. The code governing personal bankruptcy is a complex area that is subject to much misunderstanding. If the regulations are not followed, your case may be subject to a dismissal order. Make sure you have a decent understanding of the bankruptcy process before you proceed. That way, you will have an easier road.
Once you have settled on filing for bankruptcy, learn all there is to learn about your state’s bankruptcy laws. Your future depends on you knowing as much as you can and you being personally involved with your bankruptcy.
As you now know, bankruptcy is not a decision that should be made lightly. If you decide that it makes sens for your financial situation, you can benefit from working with an attorney who is experienced with personal bankruptcy, so that you can make the experience the beginning of your new, clean financial slate.
Learn and gain a firm grasp of the differences in applying for Chapter 7 bankruptcies versus Chapter 13 bankruptcies. Spend time researching the advantages and disadvantages of filing for each one of these. If there is anything that you don’t understand, go over it with your lawyer so that you can make the best decision.