Whether you are going to file for bankruptcy or are going to do a debt revision and try to get your owed expenses down, you will need to prioritize your payments correctly. It is important that you know which payments need to be paid off first. A bankruptcy attorney can help you with debt priority and show you what costs need to be eliminated first in a bankruptcy situation. It is best to sit down with a professional and make a list of all of your debts. A bankruptcy attorney will then help you to organize these debts into which should be paid first and which expenses should be saved for last or may even be eligible for a discharge.

The first debt that you need to pay off is any owed child support. This is because a failure to pay this court-mandated expense can result in arrest or prison. Depending on which state you live in, the penalties for paying child support can be steep. You may lose your drivers' license and have your wages garnished. Those who refuse to pay child support may also be incarcerated until the debt is repaid.

The second most-important debt to repay is any taxes or property liens. Whenever theirs is involved, the debt is serious and needs to be paid off immediately. Remember that ignored debts will pile up with compounding interest and penalties. The IRS has enormous power in collecting dents that are owed. The government agency has the right to seize your bank accounts or garnish your wages. As a result, you may be unable to sustain your lifestyle or even over any other payments that you have. That is why all bankruptcy professionals will recommend putting IRS-associated expenses high on the priority list.

Third, you will need to pay off your rent and/or mortgage payments. You need a place to live, but failing to pay these expenses may result in eviction. You could lose your home and the ability to secure a new place to live due to the fact that you will have poor credit. If you fear that you are going to fall behind on your mortgage, you need to talk to your lender and explain your financial situation. Some mortgage lenders will allow debt reduction or are willing to help you work through the payments. If you simply cannot afford the home that you are paying for, it may be worth it to downsize rather than to risk losing your living location.

Fourth, you need to pay for all car loans. If you want to be able to get to work and other locations you will need a vehicle. An auto loan is a secured debt. This means that if you don't pay for these expenses the lender has the right to repossess your car. If you don't need your car because you have the option to use the bus or borrow someone else's vehicle, then you may want to consider selling the vehicle.

If you are paying for an extremely expensive automobile, then it may be wise to downgrade to a more affordable car for the time being. After this, the fifth most expensive bill to pay is the utility bill. If you don't pay this expense then you will lose hot water, heat, electricity, and a variety of other benefits. It may be difficult to live a normal life without these necessities. You should do everything that you can to avoid losing power, water, and heat as this can cause a lot of discomfort. If you want more information about paying debts and how bankruptcy affects these things talk to a local bankruptcy attorney today!