Your Personal Bankruptcy Checklist

You are earning a comfortable salary and so is your spouse, so the very thought of bankruptcy must be a faraway one. You can never be too sure though, in recent times economic uncertainty has become a regular phenomena and there can be little done to control it. While you may not be able to predict the future, whether economic or otherwise, you can definitely secure it. And how do you go about doing this? Simply by keeping your own bankruptcy checklist of course. Here are a few:

1) Too many obligations?

Think once. Think more than once. How many loans have you going on? Are you struggling to pay off the installments every month? Are there any unpaid credit card bills? If your answer is yes for all these questions then, you are on your way to bankruptcy slowly but surely.

Your cash inflows and outflows need to be well balanced. Obviously, your inflow should be of higher value when compared to your outflow. When you try and balance this equation, there will be a better chance for you to face off any financial adversities.

2) Forgotten medical insurance?

Have you forgotten to avail medical insurance or don’t think it’s worth it? Seek a reliable professional to help you choose a suitable medical insurance so that you or anyone from your family needn’t be bombarded with medical bills when there is an unexpected hospital visit. This is one of the common forms of bankruptcy across the world.

3) Is your life insurance sufficient?

Although most of us avail life insurance, are we sure of how much is enough? If you have a significant debt burden, then ensuring your family is shielded from it is of the utmost importance in your absence. Evaluate carefully and modify your insurance plan if necessary.

4) Remember your good old piggy bank savings?

There is a reason everyone is gifted piggy banks during their childhood. Inculcating the habit of saving a certain sum everyday will indeed go a long way. Obviously once we grow up, banks replace our piggy banks, apart from deposits you make. It is always advisable to have at least half a year’s salary in a savings account, use this as your emergency fund.

5) Too much of a friendly guarantor?

Acting as a guarantor every time a friend asks is not a good move. There are so many reasons you shouldn’t do this: one good one would be using your assets as a collateral. Don’t fall prey to sentiments and go bankrupt.

If you have been able to clearly analyze the answers for the above checkpoints, then you will be able to get an idea of your financial position. So, start saving today, for a surer tomorrow.

How To Avoid The Pitfalls Of Personal Bankruptcy

Many people find themselves in financial trouble every now and then. It can feel hopeless and like the end of the world. This is because people don’t realize that filing bankruptcy is a viable solution to their problems. Filing bankruptcy is not as hard as we have been led to believe.

Do not get an attorney for your bankruptcy when you are feeling overwhelmed. You have got to be levelheaded when you hire a lawyer. After all, you will be expected to pay him/her for services. Find out upfront what you will have to pay any lawyer before you hire one.

If you lose your job, or otherwise face a financial crisis after filing Chapter 13, contact your trustee immediately. If you don’t pay your Chapter 13 payment on time, your trustee can request that your bankruptcy be dismissed. You may need to modify your Chapter 13 plan if, you are unable to pay the agreed-upon amount.

When meeting with a personal bankruptcy lawyer, be sure you have all of the necessary paperwork with you. This will make the whole filing process go much easier and quicker. Some of the paperwork you should have with you includes loan documents, credit card bills, and any other relevant financial documents.

Make sure that you fully understand the implications of declaring yourself bankrupt. Once you have filed for bankruptcy, you will find it difficult to secure any credit at all. While you may not see that consequence as a huge problem at the moment, if you wish to purchase a home in the future, or lease an automobile, you are probably going to need the credit.

Do not think of filing for personal bankruptcy as a shameful thing. Going through the filing process often brings out the worst in people, causing them to feel a variety of negative emotions. But, there is nothing positive about feeling this way and it can actually affect your mental state. If you are filing for bankruptcy and you are thinking negatively about the situation, make an effort to stop that now.

Do not be afraid to file for bankruptcy. Sometimes people find themselves so overwhelmed with debt that they just decide to do nothing and bury their heads in the sand. This is the worst thing that a person could possibly do. Instead, they should file for bankruptcy because by doing so, they are taking positive affirmative action and giving themselves another chance at managing their finances.

Never rely upon bill collectors to share accurate information about your debt and bankruptcy. Some unethical collectors tell consumers that their debts are exempt from bankruptcy rules, but this is actually only true for a few special kinds of debt. If a collection agency provides you with inaccurate information like this, report them to the Attorney General’s Office in your state.

Do not make the mistake of running up lots of new debt just prior to filing for bankruptcy. The court will take all of your spending into account, including recent debts you’ve incurred, and the judge may not be willing to waive debts if it appears that you are trying to game the system. Make sure that your spending habits reflect a true desire to change.

Make sure you are aware of all your options before you file for bankruptcy. For example, you may want to think about credit counseling. There are some good non-profit organizations that could help you. With their assistance, you can reduce the payments you have to make and even get some of the interest removed from your debts. You pay the organization, and they pay creditors for you.

Consider hiring an attorney to help you. The laws surrounding personal bankruptcy can be complex at best and confusing and convoluted at worst. If you feel unsure of how to go about moving forward, consulting with an attorney may be the best move you can make. An attorney can be the guiding hand you need to make the process as smooth as possible.

When you file bankruptcy, you want to avoid finding yourself in similar dire financial circumstances, so planning for and making a post-bankruptcy budget is a good idea. When you can create such a budget and stick to it after bankruptcy, you are far less likely to find yourself in the same position in the future, ensuring you are more financially free.

If you see yourself racking up credit card debt again after filing for bankruptcy in the past you need to stop yourself before you end up back to square one. Cut up any credit card s that you have and get in touch with a credit counselor as soon as you can.

What Are The Positive Factors Involved In Personal Bankruptcy Filing

Personal bankruptcy is the process of legally declaring the inability of an individual to pay off his debts. In many cases, bankruptcy might not be the only option available to you for dealing with your financial difficulties. Consulting an experienced attorney can help you gain awareness regarding your rights and available options. However, in case it is the only option available, it is important to maintain a positive approach towards it. Despite all the conventional negativisms associated with the concept of bankruptcy, it is important to know that there are several positive aspects involved in it:

  • In spite of the fact that bankruptcy can impact your credit record severely, it is also true that once the entire process in complete, all your past credit records get cleared, providing you a chance to start afresh.
  • As soon as your personal bankruptcy filing is accepted by the court, and your bankrupt status is confirmed, the creditors are legally bound to stop making direct calls to you. To get an instant relief from the harassment’s caused to by the lenders is probably one of the most positive parts of bankruptcy filing.
  • Nothing can stop you from filing for personal bankruptcy more than once if you want to and need to. However, in some forms of bankruptcy, there is a need to maintain a particular period of time between two filings. For example, while chapter 13 bankruptcy can be filed as often as you need, there’s a need to maintain a period of eight years between two successive filings for chapter 7 bankruptcy.
  • It is not necessarily true that you would lose all your assets if you file for personal bankruptcy. Instead, there are provisions in the bankruptcy laws that enable you to retain certain valuable assets and also get the advantage of easy repayment plans in accordance with your conveniences and requirements.

In case you decide to file for personal bankruptcy, it is important to make a choice between chapter 7 bankruptcy and chapter 13 bankruptcy. Again, a knowledgeable attorney can help immensely in making the right choice with regard to your financial status, conveniences and needs.

Chapter 7 bankruptcy is ideal for individuals having non-exempt assets that can be liquidated by the court in order to pay off the debt amount. However, it has been seen that merely 5% of the people opting for chapter 7 bankruptcy possesses any non-exempt assets.

Chapter 13 bankruptcy on the other hand is suitable for people who in spite of their financial crisis are having a fixed annual income. Such individuals can enter an easy repayment plan through negotiation with the lenders, which can also often bring down the debt amount to be paid. Debtors can then pay back the credit amount over a fixed period of time which actually helps them immensely.

An experienced and knowledgeable attorney is your best source to obtain sufficient information on personal bankruptcy, its advantages and flaws, and the right option for you. It is extremely important to know in details your legal rights, liabilities and options before you decide for bankruptcy filing.

Number One Reason to File Bankruptcy Is Not Creditors, But Protecting Your Stuff

Nowadays, you would really have to be an idiot to believe that the economy has turned around and things are getting better. When looking around and talking to friends there is no one I know who can testify that things are better for them than they were seven years ago. Although, it’s not a topic that people like to discuss. It’s almost like the normalcy bias has affected everyone in the United States and to go against the mainstream media makes you a conspiracy theory nut. I’m not afraid to say it, the economy sucks and doesn’t appear to be getting any better for me and my family. I suppose if you are heavily invested in the stock market you might be doing okay but even that is rolling the dice with the family farm. The dinosaur mainstream media continues to overwhelm the masses with nonsense that is otherwise known as the normalcy bias. In this case, it causes people to underestimate both the possibility of a financial disaster occurring and its possible effects. There is this idea that since they have never experienced it before, it will never happen in the future or a least their lifetime. This is why so many people on the verge of filing bankruptcy continue to leverage themselves into oblivion. Thanks to the too big to fail banks and quantitative easing that is allowing these guys to continue loaning money to people who can’t afford to pay it back.

It’s always been said that history repeats itself and it’s happening right now right before our eyes. All we need to do is make people aware of what’s really going on so their eyes will be opened to this financial disaster that is about to happen. Many Americans are now using credit cards and payday loans just to make their ends meet. They are essentially kiting themselves into bankruptcy and don’t even know it. It would be much better for this group to file bankruptcy and stop all the craziness. This idea of protecting your credit is really meaningless when at some point in time the inevitable is going to happen. Just like you tell your kids when they fall down and get hurt, when it’s time for the Band-Aid to come off, it’s much easier to rip it off then to pull slowly. Because of normalcy bias many are hoping that some miracle will happen and their situation will instantaneously turn around. With the Fed printing all the money or quantitative easy over the last five years it’s just a matter of time before hyperinflation comes to our shores. At this time, everyone in the US will get a reality check and for those that did nothing to prepare will most likely be wiped out. It’s time to stop worrying about what the creditor will think about you if you file bankruptcy and do what’s best to protect any assets you have left.

Some people say that the number one reason to file for bankruptcy is to get creditors off your back, but the only reason you want them off your back is to make sure they don’t take your stuff. This is why it’s best to be proactive when it comes to financial matters and not let creditors be allowed to file lawsuits and attach any property. Creditors these days have gotten very aggressive in their collection tactics and sometimes need to be stopped. Filing Chapter 7 bankruptcy uses the power of the automatic stay to stop creditors in their tracks. The Automatic stay is so powerful it not only stops collection activity but also stops all legal activity against the debtor. The stay will stop foreclosure, lawsuits, judgments, and even wage garnishments. The creditors can’t even contact the debtor by phone, e-mail, or even a nasty letter. If they have something to say, they will have to do it through the bankruptcy lawyer.

That’s why the real reason for filing bankruptcy is to protect one’s property. When Congress created the bankruptcy code, they wanted to make sure that Americans would truly get a fresh start after the bankruptcy discharge. That’s why they included bankruptcy exemption laws for those who file for bankruptcy. The debtor has the choice of using the federal bankruptcy exemptions or they can use state exemptions for where they are residing and filing. For individuals to get a fresh start, the exemptions are really pretty generous for individuals filing for bankruptcy. If the bankruptcy trustee could take away all of the family’s property to pay back debts, it would be hard for that family to get back on their feet.

Personal Bankruptcy May Help Cure Financial Hardships

Everybody can experience financial difficulty in their lives. The way that they respond to those difficulties is going to be the determining factor on what their next steps are. Personal bankruptcy can be an option when someone’s financial problems have gotten out of hand.

Financial hardships are not an easy thing to face. People will do whatever they can do to avoid them, but sometimes, they creep up without warning. Someone could get sick and end up with a lot of medical bills on top of not being able to earn a living.

Something could happen that was not expected also. This is something that is going to be very important to consider. Some people that are faced with bankruptcy have faced many other challenges in their lives.

Just because someone is filing for bankruptcy does not mean that they do not pay their bills. There are times in a person’s life when they simply run out of money. They cannot pay anything when there is not money coming in.

While most people are going to avoid filing for a personal bankruptcy at all costs, they may still end up doing this. When someone is getting counseled on their financial options, they can choose to go with the advice or not. This is something that is very important to consider, because what will work for one person will not work for someone else’s situation.

Financial problems are not something that are planned. They can creep up on anyone. This is something that nobody wants to deal with, but they have no choice. Their bills do not just go away.

Learning how to deal with this can help a lot. There are several different types of things that people will be able to do to help them get out of debt without filing for bankruptcy, but this can take years and years to correct. Unfortunately, it takes longer to get out of debt than it does to get too far in debt that the people are unable to pay for it.

This is something that is very important to consider. Even though, bankruptcy can eliminate a lot of debt in a person’s life, they will still have some work to do in order to build their credit back up. There are a lot of things that will help someone immediately, but long term does not work out like they had expected.

Just because someone has to file for bankruptcy, it does not make them a bad person. A lot of people will feel bad when they are filing for bankruptcy. This is something that will help them to clear their bills to a zero balance and help them get their life back.

While many people are completely against filing for bankruptcy, there are others that are looking forward to the opportunity. There are certain criteria that must be met in order to file for bankruptcy. Someone cannot just go out and buy a bunch of stuff and then file.

There are many hardships that people can run into when they are paying bills and living life. There are a lot of situations that are important to consider. Being able to take care of themselves is something that is going to be considered.

Most attorneys that are helping with personal bankruptcy can recommend options if people are unsure if they really want to file. Any bills that are not listed in the bankruptcy case will not be forgiven. This is why it is important to make sure that all bills are listed when filing for something like this. It cannot be changed after the process has taken place.

Not being able to pay bills can lead someone in many directions. There are people who think of it as a temporary problem and take out loans to cover the bills temporarily. There are other people who do not take on any more credit.

How to Avoid Bankruptcy and Save Your Assets

Bankruptcy is not the only option for someone in severe debt there is another option which people should be aware of namely the consumer proposal.

Whereas in a bankruptcy your assets are assigned to a trustee (subject to exemptions) who then liquidates them to pay your unsecured creditors, this is not the case for a consumer proposal. The consumer proposal, under the Bankruptcy and Insolvency Act, is an offer to pay your secured creditors an agreed amount of money to extinguish your debts and thus avoid bankruptcy. This money is paid interest free over a period of up to 5 years.

When a consumer proposal is filed 3 major things happen:

  1. Interest stops on your debts
  2. Your assets are protected from the creditors and a stay of proceedings is in place
  3. Creditors can no longer contact you by phone or mail or any other means

So long as you keep up the payments your assets are protected under the Act. This option is usually the preference for people with savings or equity in their house or for small business owners who need to protect their business assets to maintain an income. If three payments are missed then the proposal is annulled and you are back to where you started!

Consumer proposals do adversely affect credit and are reported to the Equifax and Transunion credit bureaus until 3 years after the proposal is paid off. One option to speed up credit building is to pay off the proposal earlier which will remove it from the credit bureau earlier.

Other advantages of the consumer proposal over bankruptcy are:

  1. If your income increases during a proposal the payments to the creditors does not. In a bankruptcy your income is monitored and payments to creditors adjusted accordingly
  2. Inheritances and windfalls are kept whereas in a bankruptcy these are paid to the creditors.
  3. You can still be a director of a company whereas in a bankruptcy you cannot
  4. You can still sponsor someone into Canada, in a bankruptcy you cannot do this until discharged.
  5. There is the opportunity to rebuild your credit faster by paying off your proposal early

Bankruptcy is not the end of the world as some people may believe and may be seen as a good opportunity to press the reset button and start again. Even if there are assets which may be seized in a bankruptcy the debtor usually has the option to pay additional funds in lieu of the asset value.