The Most Common Errors Faced Through Do It Yourself Bankruptcy

• Don't Postpone The Inevitable

Whenever people decide to opt for a do it yourself bankruptcy rather than hiring on legal counsel and listening to the time honored wisdom of attorneys who have helped literally hundreds of other borrowers with their needs, they inevitably run the risk of waiting too long to file. This could be a disastrous choice for families that instead pull out money from the equity of their homes through a refinance or second mortgage or Home Equity Line Of Credit to consolidate their credit card debt balances and put their primary residence at risk of foreclosure.

As potentially an even worse choice, some debtors nearing the age in which they had long hoped to enjoy their retirement cash out their IRAs or similar accounts, and, in nearly the blink of an eye, suddenly lose all rights to the funds that had been collected over decades to subsidize their golden years. Even if you do not actively hinder your future planning by means of borrowing against protected sums, it can be just as destructive to the larger goals of solvency to keep paying down the credit card bills until the very last minute while ignoring the regular compensation of bills for secured loans until those lenders threaten repossession or foreclosure.

• Don't Fall For The Pointless Affirmation!

To elaborate another all too common mistake committed by folks who try to save a bit of cash through cobbling together a do it yourself bankruptcy program without the assistance of any sort of trained authority on the subject, there's the problem of re-affirmation to trick the unwary filers. In all reality, there's simply no reason at all for borrowers to even consider re-affirming any consumer debt balances that would otherwise be instantly eliminated through the Chapter 7 bankruptcy protection, despite what the representatives of the lenders may try to insinuate.

It may be true that the FICO system utilized by the three credit bureaus prizes the age of the borrowers' unsecured accounts and raises the points accordingly, but, if you are already in the process of going through bankruptcy, even a do it yourself bankruptcy, it's simply not going to matter. Far better for anyone filing a Chapter 7 to simply let the courts wipe clean their liabilities – after all, the credit ratings are also influenced by the amount of money owed to lenders – for the entirety of the relevant consumer loans so that they may truly start fresh.

• Don't Let Anyone Off The Hook

Another traditional problem of the do it yourself bankruptcy programs tends to accompany the listing of lenders that must be compiled by the borrowers themselves (if there isn't the assistance of legal representation available). Most folks, worried about charges of fraud down the line for a failure to properly notify the court trustee about the slightest details regarding any valuable possessions owned or any revenue streams owed to their household, will spend hours and hours writing down anything that might run counter to the smooth passage of a Chapter 7 protection and the eventual discharge of the bankruptcy.

We certainly don't want to intimate that a full and accurate accounting of the facts regarding income and assets wouldn't be vitally important to the success of the endeavor. Nevertheless, you must remember that, even if the courts do not seem to care about your loans in the same way, the debts will never be eliminated unless the lenders have been identified in full.