Personal Bankruptcy : Can Personal Bankruptcy Help My Financial Situation?

Can Personal Bankruptcy Help My Financial Situation?

Filing for bankruptcy is not a simple process. There are many kinds of bankruptcy. They one you decide on should be based on your current debts and finances. It is important to learn about personal bankruptcy before you make the decision to file. This article will give you some of the important facts about bankruptcy.

It is easy for consumers to fear a lack of financing being offered to them after filing for personal bankruptcy. This can be true to a certain extent, though post-bankruptcy credit scores are sometimes higher than they were before a filing was made. To get your credit worthiness back on track, make sure you make timely payments.

If you are forced to file for bankruptcy, you should avoid being ashamed of yourself. Going through the filing process often brings out the worst in people, causing them to feel a variety of negative emotions. Try not to give in to these feelings, as they are of no help to you and they can affect your emotional health. Focusing on the positive during this stressful time is a good strategy for coping with your ordeal.

There are many ways to resolve financial difficulties other than bankruptcy, and you should investigate all of them first. There are many other options including debt consolidation and making payment plans with your creditors. If foreclosure is imminent, see if your loan can be altered at all through a modification plan. A good lender will be able to assist you in a variety of ways, from getting rid of your late charges to reducing interest rates. You may even be able to get a loan extension, giving you the extra time you need to pay your debt off. Creditors want to recoup the most money possible from debtors, and they can often get more through debt repayment plans than bankruptcy procedures.

Remember to only file for bankruptcy if you need to. Maybe you can just consolidate debt to make it simpler to deal with. The whole process of filing for bankruptcy can be a long, and hard one. Your future credit will be affected by these actions. Needless to say, if some alternative strategy will allow you to take care of your debts, you should give it a try before resorting to bankruptcy.

You don't need to be ashamed that you are filing for bankruptcy. A lot of people feel depressed and as if they have failed when they seek bankruptcy. If you have conducted research and decided this is your best option, look at it as a positive step in the right direction.

No matter what's going on, make sure you tell the truth about your situation. It can be catastrophic to make up things about your assets and debts. This would be breaking the law. If you lie in the recording of your debts and assets, you may end up in prison for quite some time.

Take action when the time is right. Timing is important, and that is especially true when filing for bankruptcy. Sometimes you may want to wait to file and in other situations you may find it better to do it as soon as you can. Discuss your particular situation with your bankruptcy attorney to determine the best time to file.

Look for a bankruptcy lawyer that comes from a personal recommendation instead of someone random on the Internet or in the yellow pages. There are way too many people ready to take advantage of financially-strapped individuals, so you must ascertain that your attorney can be trusted.

Do not think bankruptcy is the answer to getting rid of taxes you owe. Some filers pay the taxes that they owe with credit cards and then they file for bankruptcy. This is done with the hope of evading taxes by shifting the balance to a credit card account. However, bankruptcy laws forbid this, and you will be stuck with taxes owed as well as credit card interest.

A full year prior to filing a bankruptcy claim, you need to ensure that you don't attempt to transfer your assets to another person or entity. This will be interpreted by the court as hiding assets and prevent you from filing for bankruptcy. Certain assets are untouchable by creditors. Even so, it is never okay to try and hide assets, so delay filing if you have done that recently.

Think about opening a few new credit lines for the purpose of rebuilding credit following bankruptcy. While this is not an easy path to take, a secured credit card is a good place to start. These cards function like a credit card but you use your own money to back up the debt. If you continue to pay on time, then after a while the credit card company may give you an unsecured line of credit. If you pay off your new credit line faithfully each month, you will find that you become eligible for other credit at better rates.

Be extremely cautious before taking on any new debt. There are lots of lenders who offer loans and credit cards to those who have finished a bankruptcy. They will probably carry high interest rates and fees. So, read the fine print, carefully. They can put you right back where you started unless, you exercise very good financial discipline.

Avoid filing for bankruptcy if you make more money than your monthly bills. Although bankruptcy might seem to be an easy way of being able to pay for your debts, you must remember that it is something that will remain roughly about 7 to 10 years in your credit report.

When you feel certain that you must file for personal bankruptcy, refrain from squandering your life savings to pay off unsecured debt. You should not use your retirement savings unless the situation calls for it. Although it is quite normal to use some of your savings, ensure that you leave enough in your account for emergencies.

You are now aware that filing for bankruptcy is a choice that is one you should think through thoroughly prior to committing. If bankruptcy is sensible option for you, a good and experienced bankruptcy attorney is a must have to help you begin the process of starting your financial situation anew.