Many times people get into a financial bind, depending on the economic climate of the day. And there are many reasons why including loss of income, declining home values, too much debt, business problems, raising a family, medical bills, and others. When this happens, it might not be your fault at all. If you are in a deep hole, you should consider consulting a bankruptcy attorney for advice.
There are two kinds of personal bankruptcy, the chapter 7 and chapter 13. Chapter 7 offers you a fresh start by wiping out your debts including credit cards, car loans, and mortgages. Including the car in the bankruptcy means that you need to return your car. Chapter 13, on the other hand, restructures your debts so that you can pay them off in 5 years. Certain items cannot be included in the bankruptcy. You cannot include federal tax to the IRS, and student loan. If you plan to include your home in the bankruptcy, then you cannot keep your home. Read more about sacramento bankruptcy court.
Although it is possible to file bankruptcy yourself, it can be very tricky. You can best protect your assets by hiring the services of an experienced bankruptcy attorney. If you plan to continue paying your car and your home, then you can keep them. You can also keep your 401k, IRA, and retirement.
An automatic stay is put on your debts when you file for bankruptcy. Creditors cannot call you or contact you in any way. They must contact your attorney. When your attorney has filed your petition in court, you will have a meeting with your creditors in a bankruptcy court. Your attorney will be there to represent you in the meeting. In the court will be a trustee and he creditors are welcome to attend, although they rarely do. The trustee will swear you in, ask you to verify that you are who you say you are and that the debts are yours. If there is no dispute, you will get a discharge letter in about 60 days. You debts are dismissed and you can go on with your life. To learn more about bankruptcy lawyers in sacramento, follow the link.
It is important that you re-establish your credit as soon as possible. But since you don't want to go into debt again but you will want to start repairing your credit score. One way to do this is to get a secured credit card. In this type of credit card, you put money into the account, and use the card the same way you use a credit card. As you make payments each month on time, you will start to re -establish your credit. Then you will soon get credit card offers in the mail with higher interest rates than you were getting used to. If you don't keep a large balance or pay off your account in full each month, the interest will not matter much.