Bankruptcy is something that a lot of people have gone through, but no matter how bad your situation is, there are ways that bankruptcy can be avoided. Here are some of the ways that you can avoid filing for bankruptcy.
Debt settlement
If you have trouble keeping up with the minimum payments for the debts that you have, you might want to consider debt settlement.
Introduction: 7 Things to Consider When Filing Bankruptcy
Below is a list of items that you must think about when you are deciding to file for bankruptcy.
1. Cost. Most attorneys will try to get as much as they can out of you. Know that a typical Chapter 7 costs roughly $700 to $800, this figure really depends on the situation; however, if you have no unusual assets (such as a large boat or another house in Aspen) then look for the magic $700 to $800 number. Chapter 13s are closer to $1200 to $1300.
2. Most firms will allow you to set up a payment plan. Normally, they will ask you for $100 a month and some will even offer $50 a month. Please be aware that if they do not offer a payment plan, you probably want to go with a different attorney.
3. Although the costs quoted above are a lot of money, the attorneys you hire should get on the phone to your debt collectors soon after you hire them. Within the week of you signing with an attorney, you sould stop getting those nasty creditor calls!
4. Moreover, as soon as you hire a lawyer, you can stop worrying about your debt. You can immediately cease payment on most of the credit card or medical bills that you are struggling with.
5. Be careful of hiring any law firm that advertises on TV on a regular basis. These firms usually are "bankruptcy mills," processing thousands of bankruptcies per month. The downside to this type of firm is that you may end up with someone that will not give you the care and attention you deserve. Much better to go with a smaller, less money-hungry firm. This concept became clear to me when I was researching firms for my own bankruptcy, which I did when I lived near the Milwaukee area a few years ago. After several meetings, I found a good but fair-priced firm called Debt Advisors (their link is on the right) -- try to find something like them in your area.
6. Once you hire an attorney, your bankruptcy should begin immediately, and the entire procress (from the time you fill out your paperwork to the moment of meeting with a judge and your debt is wiped clean) should last 90 days, roughly -- again, this time frame depends on how usual or unusual your case is. Also note that 7 years after you file, the slate is wiped clean, and you can file for bankruptcy again if you need to.
7. Finally, the most important thing to know is that when you meet with a lawyer, you should get the feeling that you trust them; after all, they are handling one of the most important decisions you will ever make.
Everybody has financial problems at some time. Occasionally life slaps you down from numerous directions at times that couldn't be any more untimely, and you require help as soon as possible. Combine these knocks with the dismal times that we're presently encountering in this American economy, and it can be a frightening time to struggle to make ends meet. The principal factor to deal with when you're confronting grave financial distress is to take the whole thing into account before you do anything hasty, since in the majority of cases a firm measure of will power and discipline could get you through the tempest. However, there comes a stage when bankruptcy develops into the only practicable alternative, and it's at this moment that you have to be certain that you have all your bases covered.
There are numerous gauges to be watchful for that might warn you that you are on the path to bankruptcy. Following are some subjects to examine and evaluate with your present financial circumstances. If you see yourself accurately illustrated by a number of these issues, then it might be the time to meet with a bankruptcy attorney and work out what your subsequent steps ought to be.
1. Repeated overdraft fees. Everyone gets overdraft fees from time to time. But, if you find that you are overdrafting on an extremely frequent basis, you should inspect your bills along with your living expenses to find out whether you're living beyond your means, or if you're completely incapable of producing the funds required to cover your expenses and debt.
2. Children. If you're in a financial jam and you have children, it becomes very much more difficult to dig yourself out of a pit. Kids are a principal forecaster in bankruptcy cases. It would be smart to evaluate your bills with your monthly account and discern if you're genuinely able to provide for them.
3. Credit card problems. You should first gather your credit card statements together. See how many credit cards you have. Check how many of them are maxed out and how many are over or right at the limit. You need to be able to keep below 30 percent of the credit limit on your cards and loans. Any other number and you could end up in a dire situation.
4. Collectors are calling. If you're accustomed to disregard your phone because of non-stop bill collectors calling you for overdue bills, chances are you're headed for trouble.
Those are only a few questions to consider while you're looking at your financial outlook. Bankruptcy is a severe choice, and ought to only be a only remaining option for the majority of folks. For most people, there is a good possibility that they may be able to pull themselves out of the hole if they would sit down and devise a arrangement that will eliminate debt over time by giving up some luxuries and obtaining assistance with a monthly budget. But, if you discover that it's improbable that you'll be capable of getting your head above water soon, then you might want to consider bankruptcy as a potential fresh start.
If you are asking yourself should I file bankruptcy, try visiting http://filebankruptcypro.com, a popular bankruptcy website that offers tips, advice and resources including information on bankruptcy car loans and bankruptcy home loans. You can also sign up to receive two free eBooks about bankruptcy.
Since the bankruptcy process is already complicated, you need to get a way to make it as easy and as smooth as possible for you. Nowadays there are ways for individuals to file for bankruptcy online and it is making the process easier. There are many web sites available to guide you through the process from start to finish. The sites have a step by step guide of how to file to how to print the relevant documents.
You can also go to a search engine like
So what are the different types of bankruptcy, and which one should you apply for? There are essentially three different kinds, and which one you decide to file for is based on your current financial situation.
The first, and probably the worst of the three, is chapter 7. For this, you will have to use your personal assets (ie house, car, whatever is non exempt) to pay off your creditors.
Yes, this can be a very difficult process, as saying goodbye to these possessions you worked for and earned is not easy. However, when you are done, you will be completely discharged of your debt, and can therefore get on the path to achieving financial freedom.
With that said, chapter 7 is the cheapest type of bankruptcy to apply for, and also by far the easiest to get accepted for, because it doesn't require any sort of payment plan. All you have to do is liquidate your current assets, and you are done.
However, this might not be your best option, and here's why: with chapter 11 and 13, you don't have to liquidate your assets, and can in fact pay off your debts with the future income you generate.
Of course, in the case of chapter 11, you will need to show a detailed plan for paying off your debts, and the court needs to approve it. also, you will need to show that you have enough income coming in, as well as a reasonable amount of debt to pay off, that the plan is feasible.
No far out projection or speculations with these types of bankruptcy-if the income isn't there, this won't get accepted, and you will have to use chapter 7. However, keep in mind that chapter 7 is only applicable to business bankruptcy, and not personal. That's where chapter 13 comes in.
For this, you also need to demonstrate that you have a steady income coming in, as well as relatively low amounts of debt (check your local area for the exact amounts). If you can show this, then the courts will draw up a 3-5 year plan for you to follow in order to pay off your debts.
With this plan, you can use it for personal bankruptcy and business bankruptcy (except in the case of a corporation). While both of these are more expensive to file for than chapter 7, if you do qualify, they certainly will be worth it, as you will be able to retain your personal belongings, and your business, if you own one.
Note: in the case of chapter 13, the records of your bankruptcy stay on your credit report for 10 years, which can make taking out a loan a difficult proposition. However, if that's what you have to do, than that's what needs to be done. Hopefully this info on the types of bankruptcy will help you know which is the right choice for you.
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