Jennifer Smith Posted on 5:11 am

The Impact Of A Personal Bankruptcy On Your Credit

Nobody thinks they will experience a bankruptcy filing during their lifetime. However, circumstances can change in an instant, leaving a situation where bankruptcy may be the best choice. It is crucial that you know what to do should it happen to you. If you get yourself in this type of situation, you will surely find the information in this article very helpful.

Credit Card

Do not use a credit card to manage your tax issues and then try to file bankruptcy. Most of the time, you cannot discharge this debt. As a result, you will owe the IRS a lot of money. A common rule is that dischargeable tax means dischargeable debt. Just because your credit card could be discharged in bankruptcy does not mean you should use it.

Instead of jumping into a bankruptcy filing, be sure your situation requires it. Other available options include consumer credit counseling. Bankruptcy has a negative effect on your credit reports, in that it is permanently there. Before you take this step, make sure all your options have been considered.

If possible obtain a personal recommendation for a bankruptcy lawyer instead of randomly choosing one. Don’t allow yourself to be taken advantage of by predatory lawyers just because you are filing for bankruptcy. It is important to find someone trustworthy.

Don’t ever pay a bankruptcy attorney for a consultation, and ask a lot of questions. Most lawyers will meet with you for free and give you helpful advice, so meet with several. Don’t hire an attorney who fails to address all your concerns and questions. You don’t have to make your decision right after this consultation. This offers you the opportunity to speak with other attorneys.

Most bankruptcy lawyers offer a free consultation, so meet with several before you decide on one. Meet with the actual lawyer, not a paralegal or assistant, as they’re not allowed to give out legal advice. Searching for the best lawyer will help you located the comfort you need during this time.

Learn about teh differences between Chapter 13 and Chapter 7 bankruptcy. Research them online to see the positive and negative aspects of each one. If something doesn’t make sense to you, go over it with your lawyer prior to choosing which one to file.

Don’t be tempted to race toward a bankruptcy without taking time to make sure it is the right thing for you to do. Consolidation could be the avenue you need to get your finances back in order. Going through the bankruptcy process is a long drawn process which at times can be incredibly stressful. In addition to the stress associated with bankruptcy, you will also have to deal with severely restricted credit in the future. You have to make certain that you absolutely have no other choice.

After you have filed for bankruptcy, enjoy your life. Lots of debtors are stressed out when they’ve come to filing time. That stress could lead to complete depression, if you do not take the necessary steps to fight it. Bankruptcy is hard to go through, but you must remember that a less stressful, more enjoyable life is waiting on the other side of it.

If you are facing bankruptcy, it is important to get expert advice to address your situation and take the necessary actions to resolve it. When it comes to filing for bankruptcy, knowledge really is power. The above article has provided a lot of this knowledge so that you’re able to deal with your finances with less stress.