Many people are terrified every time to hear the word bankruptcy. Growing debt loads combined with continuous family obligations can cause an incredible financial strain. If this sounds like you and you are experiencing these feelings right now, the advice here will be of help.

Prior to filing for bankruptcy, be sure you have investigated all of your alternatives. Other available options include consumer credit counseling. Bankruptcy permanently affects your credit, so avoid filing until you have exhausted all of your other options.

If you are truly faced with bankruptcy, avoid blowing your savings or retirement money, trying to pay off debts. Leave your retirement accounts untouched unless there is absolutely no other alternative. Using your savings is necessary, but decimating it and leaving yourself dangling with no future financial security is not a good idea.

Make sure you are always providing honest documentation whenever you have to file for personal bankruptcy. You may be tempted to try to hide income and personal assets from discovery, but doing so often leads to major complications, monetary penalties and the possibility that your case will be thrown out of court.

You may end up losing more than you bargained for when you file a bankruptcy claim, so be sure that you know just which assets may be taken before filing. The Bankruptcy Code has lists of various asset types that are exempt during the process. It is important that you read this list before filing for bankruptcy, so that can find out whether or not your most prized possessions will be seized. Failure to do this could cause some ugly surprises down the road when you discover that your valuables must be seized.

Be sure your home is well protected. You do not have to lose your home in the process of a bankruptcy. It is entirely possible that you will be able to keep your home. This is dependent upon the your home’s value and whether or not you have taken a second mortgage. Otherwise, look into the homestead exemption which may allow you to stay in your home if you meet financial threshold requirements.

It is important to know how Chapter 7 filings differ from Chapter 13 filings. Weigh all the information you can find on- and off-line to make an educated decision. Before making any decisions, discuss the information you have learned with your lawyer.

Be sure that bankruptcy really is your best option. It may be that all you really need to do is consolidate some of your debts. Filling for bankruptcy is a lengthy, stressful process. You will have trouble getting credit down the line. Because of this, you should be sure that bankruptcy is your only option before you file.

Filing for bankruptcy is not the best choice if your monthly income is enough to cover your bills. The cost to your credit history far outweighs the simplicity of the easy-out bankruptcy. This is a hard pill to swallow for many.

You can take out a mortgage or car loan while filing Chapter 13 bankruptcy. However, it will be a longer and more arduous task. Your trustee must approve any new loans. You will need to make a budget and prove that you will be able to afford your new loan payments. You should also be prepared to explain why you need to purchase the item.

People who say that bankruptcy is a scary experience aren’t exaggerating. If you understand all of the ins and outs of personal bankruptcy, you need not fear it. Take these bankruptcy tips to heart and start improving the lives of you and your family members.