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Weaving Your Way Out Of The Personal Bankruptcy Maze

Though making the choice to file bankruptcy is never easy, it is often essential. This situation is handled best when you know what to expect and have information about what to do. This article contains wisdom and knowledge to help you fully understand the bankruptcy process.

Be certain you are making the right choice before you file for bankruptcy. It is possible to take advantage of other options, like consumer credit counseling. Bankruptcy is a permanent part of your credit, so before you make such a big decision, you might want to explore all other choices so that your credit history is affected as minimally as possible.

When it appears likely that you will file a petition, do not start spending your last remaining funds on debt repayment. You should never touch your retirement accounts, unless you have absolutely no choice. While you may have to use a part of your savings, never completely wipe it out which would only leave you in worse financial shape in the future.

Always be honest and forthright when it comes to your bankruptcy petition. Withholding or lying about certain information can seriously worsen your financial situation. It could lead to being unable to file for bankruptcy or even legal trouble.

Do not hesitate to remind your lawyer of any details regarding your case. Don’t just assume that the attorney will remember it automatically. Speak up if something is troubling you, as this is your future we are talking about here.

Any bankruptcy consultation should be free of charge. Free consultations are standard practice among bankruptcy lawyers, so interview multiple candidates before making a final decision. Make a choice only if you have received good answers to all the questions and concerns you brought to the table. You do not need to make a decision immediately after the consult. You have lots of time for consulting with other lawyers.

Chapter 7

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 involves the elimination of all of your debt. All happenings with creditors will disappear. But, with Chapter 13, you will be in repayment plan for about 5 years prior to any debts you have being totally dissolved. It is worth while to take your time to research both types of bankruptcy to decide which option works best for you, and your financial situation.

Prior to choosing a bankruptcy attorney, seek a free consultation with at least three attorneys. It is important to meet with the actual lawyer, because paralegals or assistants cannot give you legal advice. Shopping around for a lawyer can help you find someone with whom you feel comfortable.

Learn the differences between Chapter 7 bankruptcy and Chapter 13 bankruptcy. There is a wealth of information online about each type of bankruptcy and their respective pluses and minuses. If there is anything that you don’t understand, go over it with your lawyer so that you can make the best decision.

Be sure that bankruptcy really is your best option. Sometimes consolidating your existing debts can make them more manageable. Bankruptcy cases are long, anxiety-filled experiences. It will certainly affect the credit rating that you have in the future. You only want to file for bankruptcy after you have exhausted your other options for dealing with your debts.

Sometimes declaring bankruptcy is simply the only viable option, even though it’s one that nobody wants to take. Now, equipped with the information from this article, you can handle the process much more completely. Taking time to learn from those who have traveled this road before you will make your own journey less stressful.

Author

Carmen Evans