Filing for bankruptcy is not always as easy as one would think. In fact, there are several reasons why filing for bankruptcy may not be the best option for your financial situation. In some cases, filing for bankruptcy may need to be delayed in order to maximize the benefits it offers. In either case, there are a few things you should do before filing for bankruptcy.
Contact Creditors
Before proceeding with bankruptcy, it is a good idea to contact your creditors directly to discuss your debts. In many cases, creditors may be willing to negotiate a repayment plan that suits your budget. They may require proof of your financial hardship and your ability to maintain a negotiated plan. You can maximize your chances of successfully negotiating a repayment plan by writing a letter of hardship to your creditor. Don't be afraid of being honest about your situation and give them enough details to paint a picture of why you cannot afford to maintain your current debt payments.
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Get A Game Plan
If your creditors are unwilling to provide you with a repayment plan that you can afford, or you simply cannot afford to maintain your debt payments, you may consider filing for bankruptcy. However, the most important step is contacting a bankruptcy attorney. Your attorney can review your financial situation and help you outline a debt elimination plan that works for you. You will need to provide details about your financial standing including your income and accounts, a list of your assets and a list of your debts. Honesty is key and withholding information about debts or assets could lead to bankruptcy fraud and severe consequences.
Quit Using Credit
Before you file for bankruptcy you need to be sure you have not accumulated any more debt. There are rules about how much debt can be acquired prior to filing for bankruptcy. In general, do not take on any more debt within 90 days prior to filing your case. Now is the time to start living on cash and stretching each dollar to its fullest potential.
Get Counseled
One of the requirements of filing for bankruptcy is to attend a debtor education or credit counseling course. This course covers topics of how to set a budget, smart money management and how to use credit wisely. Before your case can be discharged, you will be required to attend this 90 minute course. Therefore, you can get a head start on the process by taking this course before you even file your petition.
Getting out of debt is a big task for many people, but it doesn't have to be impossible. Although bankruptcy offers asset protection and debt elimination, remember that your debts are ultimately your responsibility. Don't take a passive role in finding debt relief, take action and become an active part of the process.
Is Bankruptcy Right For You? Talk to Bankruptcy Attorneys Free and Confidential. Licensed bankruptcy attorneys are available. Attorneys will call you to discuss your case for free. Find out if bankruptcy is right for your situation.
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