Filing For Bankruptcy - Answers To Common Questions

As more people find themselves becoming unable to pay their debts, they are forced to undergo bankruptcy. Unfortunately there are many myths involving the whole bankruptcy process but in this article many of the more common questions will be answered. Hopefully you will find the information and help you are searching for and so desperately need.

How do I know which type of bankruptcy is best for my situation?

Only a knowledgeable bankruptcy attorney or group can make that determination for you. If you are a business with secured debts, you are subject to different laws than someone filing for personal bankruptcy. Different bankruptcy chapters vary on what laws govern your personal property and how much of your income or assets can be seized as repayment to your creditors. Always seek professional opinion before making any decisions.

Can a bankruptcy affect my retirement and 401k?

Thanks to new bankruptcy laws most retirement programs and 401k's are exempt from being considered part of a person's estate. The retirement must have an anti-alienation clause that exempts them from being seized by outside creditors. There are exceptions such as in the cases of self-employed plans but even these can fall under exemption rules. There is a cap on how much retirement is allowed before the remainder is seized as an asset. That cap, under the new bankruptcy laws, is one million dollars.

How long will my bankruptcy be on my credit report?

Bankruptcy can remain on your credit report for up to ten years from the date of filing. Once the bankruptcy has been discharged all of the reported debts will show as zero. It will have an impact on your credit score but not nearly as bad as it was before. This is a golden opportunity to learn from your mistakes and learn how to manage your debts better. You will eventually be out from under the looming bankruptcy but staying out of trouble is an entirely different story. Many people do not learn from their bankruptcy mistakes and find themselves in the same situation repeatedly.

How do I deal with credit collectors?

Well…unfortunately ignoring credit collectors is not an option. Credit collectors can employ sneaky, underhanded methods of trying to collect their debts. They get paid when you pay your debt. If you have begun the process of filing for bankruptcy and have met with your attorney, any calls or letters you receive from a collection agency need to be directed to your attorney. Once the bankruptcy process has been filed, debt collectors are not allowed to continue their threatening tactics. If they continue to do so you will need to file suit against them. New debt collection laws are in your favor if you are filing for bankruptcy. The laws do not apply if you are only considering the process.

Can a bankruptcy affect my job or future employment?

An employer cannot deny you a job based on the fact that you filed for bankruptcy. Many employers are now using credit scores and reports to make a decision on whether or not to hire a certain employee. Is this fair? No, it is not but employers do have a say when setting forth their hiring criteria. If you feel that you have been denied a job based on your credit score or history of bankruptcy, you can file a complaint with the Labor board of your state.

The Credit Repair Kit A bad credit record can make it tough to get a loan or adequate insurance, find a good job, or rent an apartment. Yet, nearly half of all credit records contain serious errors. The new edition of "The Credit Repair Kit" provides consumers with all the information they need to order a copy of their credit record, understand what their records say about them, and deal with any problems they may find in those records. Nationally known bankruptcy attorney John Ventura also educates readers about their legal rights under the federal "Fair Credit Reporting Act." Among other things, "The Credit Repair Kit" tells readers how to: Fight back if a credit bureau will not correct an error in a credit record, including how to sue a credit bureau or creditor. Rebuild credit after financial difficulties. Avoid becoming the victim of identity theft and credit-rebuilding scams. Interpret a credit score. With identity theft on the rise, "The Credit Repair Kit" also advises consumers about the steps they should take to preserve the privacy of their personal and financial information and what to do if their identity is stolen. With practical tips, sample credit reports, checklists, and information about helpful Web sites and organizations, Ventura provides readers with a first-aid kit for credit record problems.

See your Personal Credit Report and Credit Score Online - Free

Please note that the information contained on this website is for information purposes only. We strongly suggest you seek professional advice from qualified and competent financial advisors, before making any financial decisions based on the information provided on this website. See our disclaimer for full details.

Related Topics ...

Search for more information on "filing for bankruptcy" below: