When you are struggling from financial crisis and not able to pay your debts, then filing for bankruptcy is the best solution of your problem. According to Brian Linnekens, It is a serious issue, you need to have a fresh look at it once, before filling and make proper plans in order to get rid of the problem.
Bankruptcy will help us to clear credit cards bills and other unsecured bills excluding student loans and overdue taxes. For such issues the financial plan created as a part of bankruptcy will helps you.
Before filing for bankruptcy you need to understand well which areas they are covering and which are not covered. A bankruptcy attorney will give suggestions that you need to take for your bankruptcy case. Along with his/her suggestion you need to do a few other things proactively.
Create a new bank account
The very first thing you need to do is to open a new bank account. It is essential even if you file for chapter 7 and take automatic stay against collections, some creditor banks and credit unions are legally allowed to take their debts against funds you own.
To protect yourself from these situations you need to open a new account in a bank or any other financial institution from where you had not taken any credits or loans previously. Transfer your direct funds or any other funds that you have in this account.
Stop all automatic payments
Once you decide to file for the bankruptcy the next thing you need to do is to stop your auto debit payments as soon as possible. By doing this you will save yourself from penalties and other fees that is linked with failed transaction. You should use your new account for making payments of car loan, cell phone or other utilities. These small things will help you a lot during bankruptcy.
Cut up your Plastics
The key concept of bankruptcy is to give you the chance to get rid from debt that you can’t pay due to some reasons. Using credit card just prior to filing for bankruptcy is a questionable thing and on this basis a card provider can accuse you for fraudulent activity. So once you decided to file for bankruptcy you should avoid using credit card.
Create a workable budget
You need to create a workable budget so that you are able to repay your debts only then bankruptcy will work for you. According to chapter 13, all the plans for the repayment of debts are set according to the ability of your paying. After some time it is set according to your disposable income.
When you file for the bankruptcy you need to follow certain set of rules and a good attorney will help you in doing this. You need to appear in front of bankruptcy trustee with your attorney for a few questions that you need to answer. A court will issue a Notice of Commencement for the case, which decides the date and time of meeting with the creditors in order to take the clarifications.
During bankruptcy proceedings you need to go through several issues – creditors can make objection on your claim, a trustee may disapprove your case as the required paper work is not complete or even due to late submission.
The case is not over even after your bankruptcy plan is set. You need to make various kinds of communication even after that. When you get mail from your attorney, creditors or trustee; you need read it carefully and respond to it accordingly.
In bankruptcy you need proper guidance and a constant communication with your bankruptcy attorney will protect you during the bankruptcy.