Filing for bankruptcy can relieve you of one kind of financial stress, but it provides you with new stresses, too. On one hand, having people go through all of your personal financial information can be formidable. Then again, after your debts have been discharged, you can begin rebuilding finances and stopping those calls from bill collectors. Here are some simple tips anyone can use to help make the process of bankruptcy go smooth.
Do your research before choosing a bankruptcy lawyer. Take advantage of free consultations, and meet with several different lawyers before picking one to work with. Make sure that you choose an experienced attorney who is knowledgeable about the local laws, the preferences of trustees, and has a good working relationship with local judges.
Do not get an attorney for your bankruptcy when you are feeling overwhelmed. You have got to be levelheaded when you hire a lawyer. After all, you will be expected to pay him/her for services. Find out upfront what you will have to pay any lawyer before you hire one.
Before meeting with a lawyer, start compiling all of the documentation and paperwork you will need to provide an accurate picture of your finances. Gather six months’ worth of pay stubs, bank statements, bills and credit card statements. Create a list of property and assets that you own. Having this entire information ready from the beginning can save you trouble when it’s time to file.
After your bankruptcy has been discharged, or finalized, a good way to begin re-building your credit is to obtain a pre-paid credit card. This type of card is usually available at your local bank. The card is secured by the amount of money you load onto it. You can not charge more than what you have loaded onto the card, so over-spending shouldn’t be a problem. It works like a regular credit card, with monthly statements and payments. After you have kept this card in good standing for a period of time, you may be able to have it switched into a regular, revolving credit card.
Be safe and hire an attorney for help. There are many websites these days that claim to walk you through the process of filing bankruptcy on your own. It is cheaper than using an attorney to get you through this time, but it leaves a lot of room for error. This is not something that you want to take chances on.
Before deciding to file for bankruptcy, you may want to look into other options. Remember, when you file for bankruptcy, you are greatly hurting your credit score, which in turn, can prohibit you from buying a house, car, and other big purchases. Consider safer, alternative methods first, such as consumer credit counseling.
Make sure that you really need to file for bankruptcy. Some people have great luck with handling debt with debt consolidation, which means taking out only one loan to pay off many loans. Filling for bankruptcy is a lengthy, stressful process. You should be aware that there are some negative ramifications to it, like extreme damage to your credit score. Personal bankruptcy should be undertaken as a last resort when no other workable options are available to you.
Never use a paralegal to guide you through the bankruptcy process. While some paralegals may have the necessary knowledge to provide all the answers you need, they cannot give legal advice legally. Because of this, you are not guaranteed in any way to receive accurate information or advice. An attorney, on the other hand, has a legal and ethical obligation to provide you with accurate information and sound advice.
Once the initial filing period is over, ensure that you are getting out and enjoying life. Filing for personal bankruptcy can be very stressful for the debtor. This stress could morph into clinical depression, if you fail to adequately address the problem. Life will get better; you just need to make it through the bankruptcy process.
See what the value is on your home. If you are upside down on your mortgage, you may be able to eliminate your second mortgage. The main guideline for this is that your home must be worth more than what you owe on the first mortgage. This could really help your financial situation by relieving you from that large second mortgage payment each month.
If you are in the midst of a Chapter 13 bankruptcy, it is possible to apply for certain loans. It is a little more difficult, though. Your trustee must approve any new loans such as this. Create a budget and prove you can afford a new loan payment. Also, be sure you can provide an explanation as to why this purchase is necessary.
Filing bankruptcy has its good and bad points. Regardless of what your reason for declaring bankruptcy is, it is vital that you keep informed and involved in the entire process. The advice found below can assist you in dealing with bankruptcy. Make good use of these tips. You will be glad you did.