Finances Got You Down? Think About Filing For Bankruptcy
Finances Got You Down? Think About Filing For Bankruptcy
The option to file for personal bankruptcy can be a tough decision to make, especially, as it will impact your life for years to come. Know exactly what you're getting into and what it means to file bankruptcy! Use the tips from this article to help you to understand the hows and whys of filing personal bankruptcy.
One you realize you are in financial trouble and have decided to file for personal bankruptcy you should move quickly. Waiting to the last minute to file bankruptcy can cause a number of issues. You may face negative repercussions such as wage or bank account garnishment or foreclosure on your home. You can also not leave time enough for a thorough review of your financial situation, which will limit your available options.
Lots of people have to claim bankruptcy when their bills are larger than their income. If you have unmanageable debt, you need to familiarize yourself with regional bankruptcy laws. Laws differ from one state to the other. In some states, your home is protected, while in others it is not. Be sure to have some familiarity with the law in your jurisdiction.
Make sure that you have all of your financial paperwork with you when, you go to meet with your attorney about bankruptcy. They should tell you what you will need to bring. Generally, the paperwork will include car loan documents, home loan documents, and various financial records like credit card bills.
If you are thinking about paying off your tax obligations with a credit card and then filing bankruptcy, think again. In most states, you will still owe money to the IRS and have to take care of the interest of your credit cards. The main thing to remember is that dischargeable taxes are the equivalent of dischargeable debts. So, in short, do not use your credit cards to pay off debts right before you file for bankruptcy.
A critical tip in filing personal bankruptcy is to steer clear of making payments to creditors, in advance of filing a petition, in an attempt to satisfy individual debts in full outside of bankruptcy court. Payments to family members and creditors made within defined periods of time prior to a bankruptcy filing can be voided and can jeopardize the chances of receiving a discharge of all debts in the case.
Make sure that you pay all of your bills on time, since this will contribute to 35 percent of what is on your credit report. This looks good if you are trying to rebuild your credit after you have had to file for bankruptcy. Making on-time payments will increase your credit score.
As you have read in the article above, there are quite a few steps involved in filing for personal bankruptcy, but also carries a lot of responsibility. This option should be used as a last resort and you should understand the consequences of making such a tough decision. Don't be too hasty to file and keep the tips in mind from this article, when you do!