bankruptcy questions and money
If your finances are in bad shape, and you have no other options, you may be considering declaring bankruptcy.
With this consideration comes plenty of bankruptcy questions, about the process, what it means to declare bankruptcy and to be in bankruptcy, what you need to do, as well as how long you will be in bankruptcy for, and what happens when you are discharged from those debts. This site provides the answers for you, but of course, you need to check with your bankruptcy trustee to make sure all the information is valid for your state, province, or country. Meeting with a trustee is an opportunity to get your personal bankruptcy questions answered in as much depth as possible.
Will personal bankruptcy help me?
Although bankruptcy is regarded as a last resort by many, not everyone is qualified to take this option. For example, did you know that you have to be able to pay for the filing, and some trustee fees too, and be able to make a deposit towards this when you file for bankruptcy? That’s right, you have to have funds available before you can file. It’s rather like the bank charging the large amount they do for the Non-Sufficient- Funds checks.
Common Personal Bankruptcy Questions and Answers
When you meet with the bankruptcy trustee, you need to have a full accounting of the amounts you owe to creditors, what the purchases were, what your income is, and what your living expenses are. You need to include the income of your spouse too, even if it is only you that is going the bankruptcy route. The trustee will help you decide whether it is a joint petition, or an individual bankruptcy, but either way, the trustee will need to know joint income and living expenses. Your trustee will be able to answer your questions of bankruptcy law and any other bankruptcy question you come up with about your particular situation.
For more information about bankruptcy in different countries, wikipedia can help, so click here to learn more.
Once you have filed for bankruptcy, you will still have to keep in touch with your bankruptcy trustee, giving income and expense statements as required, attending financial management courses and the like, which are part of the bankruptcy requirements. Once all this has been completed for the length of time the bankruptcy court decides, provided it has been successfully completed, you will be granted a discharge from those debts filed in the court by your trustee.
After this discharge, you can start the process of rebuilding your credit score, which will take a little time, but not perhaps as long as you might imagine. Perhaps the best way is to start by applying for a secured credit card which is one that you add money too first, and then you can purchase items up to this limit. There is usually a charge to add funds to the card, but this is a good way to get you back into using credit after having only the option of cash during your bankruptcy. With careful management of your card, you will soon be able to apply for an unsecured card, with a low balance to begin with. Use this credit wisely, and never use more than 50% of it. Pay at least the minimum balance promptly every month, but preferably, pay it all off each month. This will prove that you can use credit wisely, and are a good credit risk.
For those of you living in the United States click here to learn more about the questions of bankruptcy law and personal bankruptcy issues.
With careful management of your credit, and the knowledge you gain during your bankruptcy, you will very soon be gaining a credit score, and who knows, you may be buying your own home in just a few years after you have been discharged from bankruptcy.
{ 6 comments… read them below or add one }
Hmmm…great to find out, there were without a doubt a number of points that I hadn’t thought of before.
If I purchased a car (used?) and charged it to my credit card, will I get to keep the car after bankruptcy?
In 2008 our chapter 13 was dismissed, I received an inheritance and we decided to pay off our own creditors. By the end of May 2008, all creditors were paid off except for one which was paid in August 2008. On a printout we received we noticed that money was paid to creditors that were were already paid off the date of this was June 26, 2008. I contacted two of the creditors and they stated that the money was sent to them by the trustee. The lawyer told us we should receive about five thousand dollars back. This has been over 21/2 years that the lawyers have worked on this, nothing has happened. We were told we need to reopen the bankruptcy at a charge of $800, at this time we are not financially able to do this. Is there anything else that can be done. Bankruptcy took place in Pittsburgh, Pa.
To whom it may concern,
I am considering filing bankruptcy. I was told if I did I could lose my home. I am not behind in payments on the home I live in, but behind on my 3 family rental property. I am more worried about the home I live in. Can I lose the home I live in if I file? How do I protect it from being taken? Is it true anything I have in the bank will also be taken? What about my 401k with employer?
If an idividual own shares in the stockmarket and file for bankruptcy, how does that effect the shares?
We are thinking of filing chapter 13. Will we have to pay back a loan we have for a 5th wheel travel trailer? We owe around $40,000.
Thank you