Rock Solid Tips For Avoiding Personal Bankruptcy by davids.koyu


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									                         Rock Solid Tips For Avoiding Personal Bankruptcy

Knowing what occurs when filing for bankruptcy can lessen the stresses you experience as you
make your way through the process. Having a good idea of what to expect can somewhat
cushion the pain that many who are unprepared experience. Make use of the information
below to get prepared for what the future holds.

Do not try to pay off family and friends before filing. There are very strict rules, in effect, that
place prohibitions on paying off specific debtors within 90 days before filing. The time
beforehand for paying off family members is one year prior to filing for bankruptcy. These
payoffs can cause a dismissal for your petition.

Avoid running up your debt limit before you file for bankruptcy. Judges, and creditors look at
recent history along with your current situation. A judge can deny some of your debts from
being wiped out if, they think you're just taking advantage of the system. Try to show that that
you're willing to change your fiscal habits.

Although credit cards after bankruptcy may seem like a bad idea because they are probably
what got you into trouble in the first place, they are actually necessary. Credit cards are an
essential tool for rebuilding your credit score after the huge decrease from bankruptcy filing.
Just make and pay off one purchase a month to stay safe. If no unsecured cards are available to
you, get a secured card to start.

Before you make a final decision to file for bankruptcy, look into all the options that are
available to help your financial situation. If you are buried under credit card debt, it can help to
check out a debt-consolidation, or home-equity loan if you qualify. You can also try negotiating
smaller payments on your debt until, your finances are better in control. Bankruptcy is always
an option, but if you can alleviate your problems in another way, you will be able to avoid a
major hit to your credit history.
Find out what items you are allowed to keep before you consider filing for personal bankruptcy.
You may need to surrender certain assets that you are not prepared to let go of. In this case, it
might make more sense to try consumer credit counseling first. Consumer credit counselors
negotiate with your creditors on your behalf, so that you can pay back debts on a schedule that
you can afford.

See what you can find out. Each state does have varying laws on the subject of bankruptcy.
Because of this, it is important that you meet with a specialized lawyer to discuss whether
bankruptcy is right for you. Generally, initial consultations are free to you so you are able to
determine which path you should head down at no cost.

If you have to get a new car while in Chapter 13 bankruptcy, don't try to get approval for the
most expensive car on the market. Your trustee won't approve your plan if it includes a luxury
vehicle, and you probably can't afford a high car note anyway. Stick with a reliable, but cheap
vehicle, to ensure you can afford your new purchase.

Keep your debts to a minimum prior to filing. If you are planning on filing for bankruptcy, don't
run up your debts. Your recent history will be checked by judges and creditors, and if it is
deemed that you are trying to cheat the system, you may not be able to wipe out those debts.
You will be viewed most favorably, if you can demonstrate that you have changed your
spending habits.

Having low expectations will give you the perspective to be pleasantly surprised by any good
that comes out of your bankruptcy filing. The guidance in this piece ought to help alleviate the
anxiety that commonly accompanies the prospect of bankruptcy.

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