On The Road To A Personal Bankruptcy Discharge

A lot of people in this day and age are deeply into debt. Collection agencies constantly hunt them down and their bills keep increasing. If you have been going through this for a while, you might want to consider filing for bankruptcy. Read on to learn if bankruptcy is the best decision for you.

Do not even think about paying your taxes with credit and petitioning for bankruptcy right after. The fact is that the credit card debt will be ineligible for discharge, and your tax debt may increase. 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.

Think through your decision to file for bankruptcy carefully before going ahead with it. Look into credit counseling to see if it could help you work out of your debt without bankruptcy. Bankruptcy stays on your credit for a whole decade, so if there are less drastic options that will solve your credit problems, it is in your best interest to make use of them.

If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. No matter what you do, do not touch your personal savings unless there is no other option. Of course you will have to touch some of your savings to get through all of the hearings, but do not put out any money that you do not have to by law.

You should not have to pay for a consultation with a bankruptcy attorney. Make sure you ask lots of questions. Almost all lawyers will give a free consultation, so meet with more than one before making a decision on whom to hire. Make a choice only if you have received good answers to all the questions and concerns you brought to the table. You can think about your decision before making a commitment. Take your time, and schedule consultations with more than one lawyer.

Be sure to enlist the help of a lawyer if you're going to be filing for bankruptcy. There are a lot of things to do during bankruptcy and that may be hard for you to understand on your own. An attorney that specializes in personal bankruptcy, can help guide you and make sure that your filing happens properly.

Learn the differences between Chapter 7 and Chapter 13 bankruptcies. Chapter 7 is the best option to erase your debts for good. This type of bankruptcy ends any relationship you might have with creditors. Chapter 13 bankruptcy though will make you work out a payment plan that takes 60 months to work with until the debts go away. In order to choose the right bankruptcy option, you need to know the differences between these kinds of personal bankruptcy filings.

Make sure your home is safe. Filing for bankruptcy does not always mean you will end up losing your home. You can still keep your home, it just depends on your specific situation and the value of your home. Another option is the homestead exemption that has certain income and financial requirements, but may also allow you to keep your home.

Put forth the effort to grasp the distinctions between Chapter 7 and Chapter 13 bankruptcies. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. Engage your attorney in a conversation about each type, and ask him to answer any questions you may have before deciding which kind is right for you.

Find out more about Chapter 13. If you currently have some income and don't have more than $250k in debt, you can declare bankruptcy. That way, you can hold onto your personal assets and pay back a portion of your debts pursuant to an approved plan. The window for Chapter 13 repayments is typically 3-5 years. At the end of this time, any unsecured debt is discharged. Remember that you must make every payment. Missing even one could cause the court to dismiss your case.

Hopefully, you now understand that there are many options open to you when you are giving a personal bankruptcy filing serious thought. By embarking on the process with sufficient knowledge and with the right frame of mind, it is possible to gain a fresh financial start.