The economy is bad looking these days. Because more people are out of work, more people are also falling into debt. Many of these debts end up in bankruptcy filings, which just makes the problem worse. If you’re considering bankruptcy, the following article can help you make some sense out of it.
Once a person’s debts outstrip his or her ability to repay them, bankruptcy may be the only option left. If you’re in this position, it is a good thing to familiarize yourself with the laws that apply in your area. Each state has its own set of rules regarding bankruptcy. In certain states if you file for bankruptcy your home remains protected, but the laws vary depending on where you reside. Make sure you know the laws where you live before you file.
You should avoid paying your taxes with credit cards and then immediately file for bankruptcy. Most of the time, you cannot discharge this debt. As a result, you will owe the IRS a lot of money. One thing that you should remember is that if your tax is dischargable, your debt will also be dischargeable. This means using a credit card is not necessary, when it will just be discharged.
It is essential that you are honest and forthright in the documentation you provide for your bankruptcy filings. Do not try to shield some assets or income from your creditors. This can get you in serious trouble and prevent your bankruptcy petition altogether.
Do not be afraid to remind your attorney of important specifics of your case. You should not take for granted that your lawyer will remember every important detail that you have have told him earlier without a reminder. Don’t be afraid to speak up, as it is your case and your future will be affected by its outcome.
Ask those you know if they have an attorney to recommend, instead of finding one on the Internet or in the phone book. Don’t be taken in by some fly-by-night company that exists only to profit from the suffering of others. Check out any lawyer you are considering thoroughly before engaging him or her.
Prior to filing your bankruptcy petition, go over the list of assets that cannot be seized by creditors. The Bankruptcy Code provides a list of all the different kinds of assets that you can exclude. Make sure that you review this list before you decide to file, to see if you can hang on to your most important possessions. If you neglect this important step, you might be blindsided when a possession that is important to you is taken to repay creditors.
It’s a good idea to meet with a number of bankruptcy lawyers before settling upon one. The majority of them offer free initial consultations. Always ensure that the person you meet with is a real lawyer, not a legal assistant or paralegal. These people can’t give legal advice. Look for a lawyer who you can relate to.
Although the economy is slowly picking up, there are still many people left without jobs and a decent wage. If you don’t have steady income, you might still be able to avoid bankruptcy. Hopefully, you won’t have to file for bankruptcy. Best of luck to you.