How Can Personal Bankruptcy Affect Your Life?

Anyone who has had a personal possession, such as a car, repossessed by the IRS…

Anyone who has had a personal possession, such as a car, repossessed by the IRS should consider bankruptcy. Bankruptcy can play havoc with your credit, but is often unavoidable. Continue reading to learn about the bankruptcy process, and what filing for it will mean for you.

Instead of relying on random selections from the phone book or Internet, ask around and get personal recommendations. There are plenty of companies who know how to take advantage of people who seem desperate, and it’s important to be sure your bankruptcy can go smoothly; take your time and choose someone you can trust.

Find out what you exemptions are prior to filing bankruptcy. The Bankruptcy Code lists assets considered exempt from being affected by bankruptcy. Many belongings may become eligible for repossession or seizure after filing for bankruptcy. You wouldn’t want to unexpectedly lose any possessions you treasure.

No good will come of trying to conceal your assets or your liabilities in the bankruptcy process; you want to be scrupulously honest when you declare bankruptcy. When you file make sure whoever is handling the process is fully aware of each and every financial detail. Never hide anything, and make sure you come up with a well devised plan for dealing with bankruptcy.

Filing Bankruptcy

If you are seriously thinking of filing bankruptcy, make sure that you contact an attorney. There are many different aspects to filing bankruptcy, and you may not understand everything there is to know. A lawyer that specializes in bankruptcy can make sure you are following the correct procedures in your filing.

Understand the differences between Chapter 7 and Chapter 13 bankruptcy. Every one of your debts will be gone if you decide to go with Chapter 7. Any ties you have concerning creditors will definitely be dissolved. If you file using chapter 13 bankruptcy, you will go through a sixty month repayment plan prior to all your debts being completely dissolved. It is worth while to take your time to research both types of bankruptcy to decide which option works best for you, and your financial situation.

Before filing bankruptcy consider every available avenue. You may find consolidating your debt may be simpler. Declaring bankruptcy is a very involved process that can cause a good deal of anxiety. Having a bankruptcy on your record will hinder your ability to get credit in the future. Therefore, you must make sure that there is no other option that you could take before you file for bankruptcy.

Look into filing Chapter 13 bankruptcy. If you have less than a quarter of a million dollars in debt that is unsecured and a regular income, you are eligible to file a Chapter 13. That kind of bankruptcy allows you to hold on to your personal things and real estate while repaying your debts with a plan to consolidate your debt. These kinds of plans usually range across 3, 4 and 5 years. Once this is done, all your unsecured debt will get discharged. Keep in mind that even missing one payment can be enough for your whole case to get dismissed.

This article has made it known that bankruptcy is something you may be able to turn to. That said, you should think twice before filing, since it leaves a huge black mark on your credit. Arming yourself with knowledge is a good way to protect assets and approach the process wisely.