No one ever thinks that they will go through a bankruptcy. Sometimes there is simply no viable alternative in a given financial situation. This is when it's important to understand the basics of bankruptcy. If you discover that you are faced with bankruptcy, you can help yourself with the knowledge provided below.
Before you file for bankruptcy, find out which of your assets will be exempt from seizure. You can find a listing of the asset types that are excluded from bankruptcy in the Bankruptcy Code. It's crucial to read that list before filing to see which of your prized possessions can be seized. If you do not read this list, you could be in for some nasty surprises in the future, if some of your most prized possessions are seized.
Don't try to hide anything if you are filing for bankruptcy, as this will hurt you in the long run. Regardless of the agency you file with, ensure that you tell them all they should know about your current financial situation, regardless of how good or bad it is. Lay everything out on the table so that you and your lawyer can devise a plan to get you out of this mess.
If you're going to file bankruptcy, you need an attorney. Personal bankruptcy is quite complex, and it is entirely possible that you will not be able to familiarize yourself with all the laws and processes. Talk to a bankruptcy lawyer, they can help clarify anything that you might have confusion with.
Know and understand the difference between filing for Chapter 7 bankruptcy versus Chapter 13 bankruptcy. Spend time researching the advantages and disadvantages of filing for each one of these. Before making any decisions, discuss the information you have learned with your lawyer.
If you make more money than what you owe, filing for bankruptcy is not a good option. Though bankruptcy may appear to be a good way to escape your debts, it does affect your credit negatively for a fairly long time.
Remember that your Chapter 7 filing may affect other people in your life as well. Debts which you shared with another will not be your responsibility any longer if you file for personal bankruptcy under Chapter 7. This does not dissolve any co-signers of the debt, and your creditors will continue to try and collect from them.
Under no circumstances should you take out a huge cash advance on any of your open credit cards before filing for bankruptcy. To do this would be considered fraud. Even after filing for bankruptcy, you might be forced to repay money gained in this manner.
After filing for bankruptcy, many individuals vow they will avoid the use of credit cards and all forms of credit. This is not a smart move, since using credit wisely allows you to build a solid credit history. In the future, you will almost certainly need credit to make major purchases, such as a house or a car, and your credit score will be dreadful if you haven't used credit since your bankruptcy. Get one credit card and use it wisely to get on the right path.
When you file for bankruptcy, it doesn't mean that you will lose your assets. You can keep some personal property. These personal items include clothing, jewelry, household furnishings, electronics and other similar items. Depending on your financial situation and what state you live in, you might be able to keep property such as your home and car, or even recover property that has been recently repossessed.
Make sure to include all of the debts that you want eliminated on your bankruptcy filing papers. Any debts omitted from the paperwork will not be covered in the discharge. It's your duty to be sure you have everything written down that is important because some debts that could have been discharged may be missed.
If you are filing for bankruptcy, be sure you are being honest, no matter how dire your situation is. One very important point is to never lie or withhold details regarding your personal assets and debts. This is not legal. You could go to prison for lying on a bankruptcy petition.
Once you have determined that you have no alternative to bankruptcy, educate yourself on all the areas of bankruptcy laws, in your state, as much as possible. By learning as much as possible before, during, and after your bankruptcy you can help set yourself up for a better financial future.
If the biggest issue you have pertains to student loans, it can be very hard to get approved for bankruptcy. Even though laws are different in different states, debt from student loans are some of the most difficult kinds of debt to be discharged. You will be forced to show an extreme hardship if you hope to have it discharged.
You should not let your bankruptcy lawyer take complete charge of your case. Of course, your lawyer is truly the expert in regards to bankruptcy laws; however, you will do well to educate yourself. While it may seem simpler for your lawyer to do everything for you, it is your financial future on the line so take a strong interest in what is happening.
Make sure to come out of the bankruptcy better informed and better able to handle your finances. Unplanned hospital bills are different from undisciplined spending when it comes to shopping. If you can't seem to avoid spending too much on non-essential things, you should consider seeking help in order to prevent future financial difficulties from occurring.
If you meet with an attorney, be sure to disclose to them all significant debts you owe. That means you need to tell him about credit cards, lenders and hospitals, but you also have to mention money you need to repay to friends and family.
You should understand that you need to speak with a bankruptcy attorney about what you should and should not do when it comes to bankruptcy. Your process will be much simpler if you have a large knowledge base. The article you just read have you some of this advice, meaning you can deal with your situation much better.