Things To Consider Before Filing Bankruptcy

April 21, 2012 by  Filed under: Bankruptcy 

Small business owners and consumers who are facing increasing debt may think of filing for bankruptcy. Sometimes, filing bankruptcy is the only choice to come out of those debt issues. Credit counselors and bankruptcy experts are experts for seeking advice before thinking ahead and filing for bankruptcy.

The rapidly decreasing economy, rising medical costs and job losses may lead many people to file bankruptcy.

There are several things an individual has to consider before filing the bankruptcy. One important aspect you should think about is what chapter of bankruptcy can be applicable to your case and also consider whether the chapter is best option for you. Some important things that you need to consider before filing bankruptcy, such as:

• Find a lawyer: This is the first thing you need to do. Although according to law, there is no compulsion to hire an attorney for bankruptcy filing, but bankruptcy is a highly complicated part of law that alters frequently. Even though you want to do it yourself, you may not do it properly, so it is better to hire an attorney. Make sure that the lawyer should be experienced in dealing such cases and also responsive towards your case, and you should feel comfortable while working with the lawyer.

• File your taxes: While you are filing bankruptcy, it is required to file all of your tax returns with a copy of most recent return. If you have failed in filing your taxes, bankruptcy can be banished.

• Keep paying for the things that you want to keep with you: If you file bankruptcy and you want to keep your car, house, or any of your assets that have loan against them, you need to continue making the payments on debt.

• Stop paying unsecured debts: Unsecured debts will be detonated in bankruptcy, so that you don’t have further liability for those debts. These unsecured debts include things like personal loans, credit cards and medical debts. If you have decided to file bankruptcy, there is no sense of paying these debts. It is just throwing away your money. Some debts like most past due taxes, student loans cannot be set to free even though they are unsecured. So, you are required to continue payments for these debts.

• Get Credit report: Get a copy of the credit report as this can make you observe what exactly your debts are. This will be helpful for you to understand your entire financial picture and you can decide whether filing bankruptcy is best option for you or not.

• Gather documents: You need to gather lot of documents to prepare bankruptcy petition, many of the documents are required to receive within time. Plan according to that and begin gathering information regarding your assets, debts, expenses, and income.

Riverside Bankruptcy attorney can help you a lot in filing bankruptcy. To know more information on filing bankruptcy, you can consult experienced bankruptcy attorneys in your area.

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