Nobody wakes up and says "I think I'll get myself into debt and file for bankruptcy when things get too hot to handle." Bankruptcy is usually a last resort and understanding the process is important. If you are approaching a bankruptcy situation, reviewing the advice presented below may help you understand what happens next.
Make sure you are always honest when filing your petition for bankruptcy. Trying to hide anything could get your petition shot down in court. Make sure that you disclose all income and assets that are relevant to the bankruptcy proceedings. This shows the court that you are doing your best to resolve your situation, and helps them expedite your proceeding.
You can either qualify for a Homestead Exemption to Chapter 7 or you should file for Chapter 13 to secure your home. There may be situations in which it makes more sense to convert a Chapter 7 case to a Chapter 13, but it is important to discuss such a strategy with your lawyer.
When you file for bankruptcy, you should be very aware of your rights. Bill collectors will lie to you and say you can't have their bill discharged. You should know that only a few debts cannot be erased, including student loans and child support. If a debt collector tells you this false information, seek the advice of your bankruptcy attorney. You may also want to report the bill collector to the attorney general's office.
Do not use credit cards for cash advances prior to filing a bankruptcy petition, as it can affect the dischargeability of the debt. If you were to do this you could be charged criminally with fraud, because the act is intended to rip off the company.
Ensure that you include any debt to be eliminated on bankruptcy filing papers. If you forget to include any of your debts in the filing, you lose the chance to discharge them. It is up to you to ensure all things that need to be taken care of are written down, otherwise you will be stuck paying on things that weren't discharged.
No matter how bleak the situation; always be honest. Lying about assets and debts is something you really should not do at all. Also, it is against the law. You may go to prison if you lie when recording your assets and debts.
Before filing for bankruptcy, look into which debts it will clear in your situation. Certain classes of debt, including taxes, child support, and student loans, are not eligible for bankruptcy. This kind of debt is best tackled through a loan consolidation company or an agency that specializes in credit repair.
Proceed with your bankruptcy plans even if you obtain new employment before your filing date. Bankruptcy could still be your best option. The timing of your bankruptcy is important. If you file before the new employment commences, your repayment options will be considered without this new wage figure being taken into consideration.
Be warned that after your bankruptcy, you may stand out as a leper to credit institutions. You may be unable to get a simple credit card. If this happens to you, think about applying for a couple of secured credit cards. You can exhibit your desire to rebuild your credit this way. Once you've built up a history of on-time payments, you may start getting unsecured credit again.
Some consumers filing for personal bankruptcy think they will struggle to get financing afterwards. In some cases, this might be true, but in others, your credit score may actually end up higher post-bankruptcy than it was pre-bankruptcy. After having filed for bankruptcy, it is important that you make timely payments in order to rebuild your credit scores.
Once you determine that claiming personal bankruptcy is something that you must do, you will need all the advice that you can get. The more you know, the easier everything is going to be. Now that you have read the advice shared here with you, you can move forward on the right financial path for you.
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