Bankruptcy vs Foreclosure
Many people are facing foreclosure nowadays and are having a hard time sorting out their problems because of many misconceptions and general lack of information. Bankruptcy is a major fear for many people currently facing foreclosure since they believe that it will only make their situations worse. What they don’t know is that it could actually be helpful to them just like other solutions available today for victims of foreclosure. People who lack a clear understanding concerning bankruptcy will continue to suffer since they don’t consider it a useful way of sorting out their problems.
Bankruptcy is not a simple option for stopping foreclosure. It should only be done after thorough preparedness and research. It is a fact that bankruptcy can help stop foreclosure. However, bankruptcy could also have a negative impact on you. This method can help you and at the same time create a problem.
The following are some useful tips that will help you understand how bankruptcy works.
- You need to submit a complete list of your assets and property when filing for bankruptcy. The purpose of this is to ensure that you won’t have problems much later. Many people worry about bankruptcy because they think that the court will confiscate all their property. The truth is, the court will not touch your belongings if you just submit the compete documents which are required of you. All the items listed will receive protection under the law. Therefore, you won’t have to worry because nothing will be taken away.
- You need to be ready for a messy credit report. Filing for bankruptcy won’t be a solution for your poor credit rating. If you had a bad credit rating, it will remain as it was. Don’t believe the myths which say that bankruptcy could polish up and cover your credit score. You need to be ready because the bankruptcy will remain on your credit records for seven up to ten years, depending on the amount of debt you have. This is why many people are reluctant to declare bankruptcy.
- Lies could lead to dismissal of the bankruptcy case. You need to be very sure that you are prepared before deciding to go through with bankruptcy. If you are found to be lying before the court, it may lead to case dismissal and you could even be punished. Before filing for bankruptcy, make sure every document you have is genuine and that what has been written there is true. You will need to hire the services of a bankruptcy lawyer to help you start off the process. Besides representing you in court, the lawyer will also help you get ready for the process which you will be going through.
- Avoid incurring any additional debts since it will just make the situation worse.
Going through foreclosure proceedings will not be easy. It will not be beneficial to you if you opt to use bankruptcy to stop foreclosure if you are not informed about the process you will have to go through.
Stephan is a freelance writer, who often writes about Avoid Foreclosure and home foreclosure.
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