Here are several things you should keep in mind, especially if you’re planning to file for bankruptcy in the coming months:
Consider all your options first.
Always remember that although filing for bankruptcy can seem to be the easiest way out of your debt problems, it can also inflict severe and long-term damage to your credit history and even to your financial prospects. That’s because records of your bankruptcy proceedings will be retained in your credit report for the next seven to ten years. And having such derogatory mark in your credit file can surely work to your disadvantage. After all, it could chase your prospective creditors away. Moreover, it could make it harder for you to qualify for low-interest credit deals, later on.
So, before filing for this credit-busting option, we advise you to consider first your other alternatives. For instance, have you given debt consolidation a serious thought? If you haven’t then, why don’t you give it a shot? Keep in mind that by consolidating your credit card charges as well as your existing loans, you can possible pay off your debts, in one full-swoop. Moreover, such method can help you in rebuilding your credit history. In fact, it can improve your chances of once-again receiving excellent credit programs that are usually offered to consumers with good credit standing.
Consult a bankruptcy lawyer, before filing either for a Chapter 7 or 13 Bankruptcy.
After all, such professional can provide you with excellent advice that can help you realize whether or not it would be wise to push through with your plans. Moreover, he or she can help you prepare the forms, financial documents and other requirements that will help boost your likelihood of being allowed to discharge your existing financial obligations through Chapter 7 Bankruptcy.
Subject yourself to the income-means-test.
To find out which type of bankruptcy you should file for; we advise you to take the income-means test, as early as you can. After all, this test will help you realize if you will be allowed to discharge your debts under a Chapter 7 Bankruptcy or you will have to reorganize your finances to gradually pay off your debts based on the provisions of a Chapter 13 Bankruptcy.
Do your best to rehabilitate your credit history, as soon as you receive approval on your application for bankruptcy.
To do this, you should resolve never to commit the same mistakes that pushed you down into debt traps. Moreover, we advise you to employ simple tools that will help you manage your personal finances, in the best way you can.
For instance, you may decide to draw up and stick to a personal or a household budget. Or you can apply for and take out a secured or a prepaid credit card which you can use for covering your day-to-day expenses. In so doing, you can minimize your risk of incurring a huge financial obligation. At the same time, you can boost your likelihood of qualifying for credit deals, which carry reasonable rates of interest and charges, despite the presence of a bankruptcy record in your annual credit report.