If you want to file for bankruptcy, you may not know where to begin. And it is true, there is a lot of information out there and a lot of bankruptcy laws you need to comply with. Here are some essential tips for handling bankruptcy, so that you know what you’re getting into.
Get a plan in place for after your bankruptcy is over. Your debt will be forgiven, but you have to find a way to make sure that your financial picture will recover. Set definite goals so that you are always working toward a financial future that will never get you in this position again.
Once you have filed for bankruptcy, you need to go over your finances and do your best to come up with a manageable budget. You want to do this so that you will not end up so deep in debt again that you will have to file for bankruptcy, again.
Don’t be afraid to apply for credit for purchases such as a new home or car just because you have a recently discharged bankruptcy. Many lenders will take your new financial situation into account. They may be more likely to loan money to someone who has no debt due to a bankruptcy than to the person with, say, 75,000 dollars in credit card debt. The fact that you have no monthly credit card payments can make you look like a better risk.
Don’t let bill collectors convince you that you are ineligible for bankruptcy. Debt collectors do not want you to file bankruptcy under any circumstances because it means that they will not get the money you owe them, so they will always tell you that you do not qualify when given the chance. The only way to truly know if you qualify is to do some research or speak with a bankruptcy attorney.
When it comes time for you to hire an attorney to deal with your bankruptcy, be sure to find one that has a ton of experience with personal bankruptcy. Learn about the charges you will have to pay, and how many of their associates will be working on your case.
Prescreen any bankruptcy lawyer before hiring one. Because bankruptcy is an every-growing area of law that attracts new lawyers all the time, you are likely to encounter many new lawyers who do not have much experience. You can check any bankruptcy lawyer’s credentials online and see if they have any disciplinary actions on their record for improper filings or practices. You are also likely to find client ratings. In the matter of choosing a lawyer, one with experience and a positive record is always best.
If you are trying to rebuild credit after filing for bankruptcy, you should apply for secured credit cards. These can help you establish credit, but you have to make sure that they are one of the companies that report to the major credit bureaus, since all of them do not.
Do not assume that declaring bankruptcy will leave you homeless, or without transportation. Depending on how your bankruptcy is set up, you may be able to stay in your home or keep your automobile, so long as you continue to make payments on your car loan or your mortgage.
Exercise some caution in repaying your debts when you know a bankruptcy filing in your future. There are many laws when it comes to bankruptcy, including prohibition of paying some creditors 90 days before you file, as well as family for a whole year. Make sure you have a complete understanding of what is occurring prior to making any final decisions.
If you want to try to avoid bankruptcy, you have to do everything you can to reduce your expenses. Sit down and write-up every expense you have for the month and start slashing. It does not matter how small, even the buck you spend at the coffee machine helps and adds up.
Having the right information is always the first step toward any decision, and bankruptcy is no different. Before making a decision on what you should do, take the time to learn all you can about it. Only then, can you feel confident about what you should do and how to proceed.