Learn from your mistakes and vow to be more financially responsible after filing for personal bankruptcy. With a clean slate, it is possible to start over both financially and personally. Keep reading to see how bankruptcy can actually give you a new lease on life, rather than function as a permanent financial albatross.

If you plan to pay debts off before you file for bankruptcy, be careful. You may find that bankruptcy law prohibits you from paying back some types of creditors for 90 days before you file, and a year for family members. Make sure you have a complete understanding of what is occurring prior to making any final decisions.

If you are filing for chapter seven bankruptcy, the dismissal of the balance of your debts is not a given. Certain debts are secured and will have to be reaffirmed through a new agreement: for instance, student loans cannot be erased by filing for bankruptcy. Here are some of the debts that cannot be discharged under Chapter seven: alimony payments, child support payments and court-sanctioned fines.

Paying your bills in a timely manner can help you avoid late fees, penalties, high interest rates and the need to file for bankruptcy. The biggest mistake people make is that they pay the smallest amount due and their debt never goes away.

Filing for bankruptcy is not recommended when you have income more than your debts. Although bankruptcy may feel like a simple method of getting out of your large debt, it leaves a permanent mark on your credit history for up to 10 years.

Don’t use a credit card to pay off your taxes before filing for bankruptcy. Most places will not consider the debt dischargeable, meaning you will have to pay the IRS a lot of money. Rule of thumb is if the tax is dischargeable, then the debt will be dischargeable. It is pointless to use credit cards if they can be discharged.

As you read in the beginning of this article, bankruptcy is not something anyone looks forward to. Even though that is the case, you should not allow it to depress you in any way. In fact, if you apply the ideas and advice given in this article, you can truly make bankruptcy a turning point in your life towards better days