Sadly, bankruptcy is now a household word. The recession has hit many people very hard. You need to approach bankruptcy with a little knowledge so that you can simplify the process. This article will help you to make the best choices.
Avoid paying for a consultation with the bankruptcy attorney, but do ask many questions. Most lawyers offer free consultations, so consult with a few before settling on one. Only make your decision if all your questions and concerns are adequately addressed. You do not need to make a decision immediately after the consult. This allows you time to speak with numerous lawyers.
It is imperative that you retain an experienced attorney if you are planning to file bankruptcy. 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. A personal bankruptcy attorney can help and guide you along through the bankruptcy process.
NOTE! Don’t be reluctant to remind your lawyer about specific details he may not remember. Many times a lawyer may forget a key detail; therefore, it is important to remind your lawyer of any key information.
Personal Bankruptcy
There are two types of personal bankruptcy: Chapter 7 and Chapter 13. Make sure you know what each entails so you can make the right choice. Chapter 7 bankruptcy is intended to wipe out all outstanding debts. Any ties you have concerning creditors will definitely be dissolved. Chapter 13 is different, though. This type of bankruptcy entails an agreement to pay off your debts for five years prior to wiping the slate clean. When choosing the type of personal bankruptcy that is correct for you, it is very important that you know the differences.
Safeguard your home. Filing for bankruptcy will not always result in losing your home. If your home has significantly depreciated in value or you’ve taken a second mortgage, it may be possible to retain possession of your home. There are other options such as a homestead exemption which offers you a chance to remain in your home, depending on whether or not you meed certain financial conditions.
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You should weigh every option before thinking about bankruptcy. Talk to a bankruptcy lawyer to see if a debt repayment plan or reduction in interest rates is a viable option for you instead of bankruptcy. If a foreclosure is your reason for filing look into your options with your bank first, such as a loan modification. There are a lot of ways that your lender can assist you, such as reducing interest rates, eliminating late fees, or extending the term of your loan. When push comes to shove, creditors want their money, and they are willing to make concessions to get it and prevent the debtor from declaring bankruptcy.
If you are worried about your car being repossessed, consult your attorney about trying to get the monthly payment lowered. You can often lower your payment using Chapter 7 bankruptcy. But, your car has to have been bought at least 910 days before you file. Also, it must come from a high interest loan and you have to have been consistently working.
As this article stated, the subject of bankruptcy is on many people’s minds nowadays, due to the economy. To make certain you are making wise choices about bankruptcy, make certain to use the information in this article.
NOTE! Be honest when filing for bankruptcy, because hiding liabilities or assets can only cause trouble to you. It is necessary to be open regarding both the positive and negative aspects of your financial life.