Determining Bankruptcy Debt Priorities

Should a person at any time need to file for bankruptcy, it is important that they know that there are certain bankruptcy debts which will need to be paid over some of the others. In this article, we take a look at just what some of these essential bankruptcy debts are and why payments should be made. Certainly, if you decide to avoid making such payments to these creditors, your financial problems can become much more serious.

The most essential bankruptcy debt that one should ensure that you make is the payment for your mortgage or rent. This should be the most important payment and top of any debt list to ensure that you and your family have a roof over your heads at all times. But if you think that actually making these payments is going to be difficult then you need to seriously think about selling up or renting a property that is better priced. Should you think about selling your home in order to help reduce your overall debts, it is a good idea to spend time considering both the pros and cons of doing this. What you may actually find is that if you were to wait a few months or even a year, then the value of your home may well have increased and you will have more cash available to then pay of some of your creditors with. Another essential debt that one should make sure is paid after filing for bankruptcy is all utility bills.

Being without any of the essentials such as heat, electricity, water or a telephone could leave you in a situation, which could seriously affect all those who are living with you. If you are someone who has a car that has been purchased using a loan then you will need to make sure that you keep up the payments on this. However, if you find that this proves to be somewhat difficult it might be an idea to sell the vehicle and use any cash left over from the sale (after paying off your creditors) to purchase something a little cheaper. But if you find that by selling there will not be enough funds available to buy another car then it might be advisable to return the vehicle to the dealer and avoid getting it repossessed instead. When it comes to what debts need to be paid when a person is declared bankrupt then the IRS will want payment for any unpaid taxes that you have. If you would like to avoid them taking the funds directly from your paycheck, bank account or through repossession of your home then speak to them immediately.

Doing this you should then be able to negotiate a repayment plan in order that you can settle the sum that is outstanding. It is important that you do arrange to make the payments on all your essential debts before you start thinking about the nonessential ones. Just because you owe a few dollars on your hardware store bill, do not go and pay this because they are hassling you.

Instead, it is more crucial that you pay your mortgage or rent and utility bills to ensure that you are safe and secure. Then if you have any funds available, allow a small payment to be made to the nonessential creditors to keep them happy. Above we have looked at what types of bankruptcy debts a person will need to pay after being declared bankrupt to prevent their situation from becoming any worse. In a large number of cases after filing for bankruptcy with the courts, they will arrange for a financial advisor to assist the person to ensure that such debts are paid.

For more information and additional insights about how to analyze your Bankruptcy Debt as well as getting a free bankruptcy evaluation from a qualified bankruptcy lawyer local to you, please visit our web site at http://www.bankruptcy-data.com