Bankruptcy And Your Credit: The Impacts Of Filing

Even though filing for personal bankruptcy can seem like something to put off, you should not wait too long to do it. Know what you are about to go through and then learn some tips to get through it as painless as possible. Use the tips and information that follows, as a way to reduce the stress you experience.

Don’t be afraid to apply for credit for purchases such as a new home or car just because you have a recently discharged bankruptcy. Many lenders will take your new financial situation into account. They may be more likely to loan money to someone who has no debt due to a bankruptcy than to the person with, say, 75,000 dollars in credit card debt. The fact that you have no monthly credit card payments can make you look like a better risk.

Avoid exhausting your savings or emptying your retirement accounts to pay off creditors if you are considering filing for bankruptcy. Leave your retirement accounts untouched unless there is absolutely no other alternative. You may need to use some of your savings; however, you should not use all of your savings. Remember that you must safeguard your future financial security.

Use a personally recommended bankruptcy attorney instead of one found through the Internet or phone books. There are many companies who take advantage of financial desperation; that is why it is important that you get someone that is trustworthy.

Find out what the homestead exemption limit is in your state before filing for Chapter 7 bankruptcy. If you have too much equity in your home to qualify for the exemption, you could lose your house in the bankruptcy. You can’t change your mind once you’ve begun the process, so make sure you will be able to keep your home before you file.

If you are trying to rebuild credit after filing for bankruptcy, you should apply for secured credit cards. These can help you establish credit, but you have to make sure that they are one of the companies that report to the major credit bureaus, since all of them do not.

Don’t pay for the consultation with a lawyer who practices bankruptcy law; ask a lot of questions. Most lawyers offer free consultations, so talk to a few before making your decision. The lawyer who properly answers your questions is the one you should hire. You don’t have to make your decision right after this consultation. Consulting with several attorneys will also help you find someone you trust.

Filing for bankruptcy does not wipe out all of your debts. It does not stop you from having to pay alimony, child support, student loans, tax debt and most types of secured credit. You will not be allowed to file if these are the only types of debt that you have on record.

Once you have made the decision to go ahead with the process of filing personal bankruptcy, use the tips here to help you through it. You will find it much easier to manage the process, now that you have taken the first step and looked for the help you have received here.