How to avoid the pitfalls of personal bankruptcy
Many people find themselves in financial trouble from time to time. It can feel hopeless and like the end of the world. This is because people don’t realize that filing for bankruptcy is a viable solution to their problems. Filing for bankruptcy is not as difficult as we have been led to believe.
Don’t look for a bankruptcy attorney when you feel overwhelmed. You have to be sensible when you hire an attorney. After all, you are expected to pay him for the services. Find out in advance what you will have to pay any attorney before hiring one.
If you lose your job or face a financial crisis after filing Chapter 13, contact your trustee right away. If you do not pay your Chapter 13 payment on time, your trustee can request that your bankruptcy be dismissed. You may need to change your Chapter 13 plan if you can’t pay the agreed amount.
When you meet with a personal bankruptcy attorney, make sure you have all the necessary paperwork with you. This will make the entire filing process much easier and faster. Some of the documents you should have with you include loan documents, credit card bills, and any other relevant financial documents.
Make sure you fully understand the implications of filing for bankruptcy. Once you have filed for bankruptcy, it will be difficult for you to obtain any type of credit. While you may not see that consequence as a big deal right now, if you want to buy a house in the future or rent a car, you’ll probably need the credit.
Don’t think of filing for personal bankruptcy as embarrassing. Going through the introduction process often brings out the worst in people, causing them to feel a variety of negative emotions. But there’s nothing positive about feeling this way, and it can actually affect your state of mind. If you file for bankruptcy and are thinking negatively about the situation, make an effort to stop that now.
Don’t be afraid to file for bankruptcy. Sometimes people find themselves so overwhelmed by debt that they simply decide to do nothing and bury their heads in the sand. This is the worst thing a person could do. Instead, they should file for bankruptcy because by doing so, they are taking positive affirmative action and giving themselves another chance to manage their finances.
Never trust collectors to share accurate information about your debt and bankruptcy. Some unethical collectors tell consumers that their debts are exempt from bankruptcy rules, but in reality this is only true for some special types of debt. If a collection agency provides you with inaccurate information like this, report it to your state Attorney General’s Office.
Don’t make the mistake of racking up a lot of new debt right before you file for bankruptcy. The court will take into account all of your expenses, including any recent debts you have incurred, and the judge may not be willing to discharge debts if it appears that you are trying to cheat the system. Make sure your clothing expenses reflect a true desire for change.
Make sure you know all of your options before you file for bankruptcy. For example, you may want to think about credit counseling. There are some good non-profit organizations that might be able to help you. With their help, you can reduce the payments you have to make and even eliminate some of the interest on your debt. You pay the organization and they pay the creditors for you.
Consider hiring an attorney to help you. The laws surrounding personal bankruptcy can be complex at best and confusing and convoluted at worst. If you are not sure how to proceed, consulting with an attorney may be the best thing to do. An attorney can be the guiding hand you need to make the process as smooth as possible.
When you file for bankruptcy, you want to avoid finding yourself in similar dire financial circumstances, so it’s a good idea to plan and budget post-bankruptcy. When you can create such a budget and stick to it after bankruptcy, you are much less likely to find yourself in the same position in the future, ensuring greater financial freedom.
If you find yourself racking up credit card debt again after filing for bankruptcy in the past, you need to stop before you go back to square one. Cut up any credit cards you have and contact a credit counselor as soon as you can.
After reading this article, you should realize that there are things you can do when your finances are out of control. You have the right to file for bankruptcy. If you keep the advice in this article in mind, the path you take to move forward in managing your debt should be a little easier.