Common Bankruptcy Myths Debunked
It’s neither easy nor pleasant when you have to file for Chapter 13 or Chapter 7 bankruptcy. Many people break into cold sweats at the thought of filing for bankruptcy. You may think that if you file for bankruptcy you will lose everything and you’ll have to start life all over again, which is untrue. There are many myths like this about bankruptcy that need to be busted. We compiled a list of the most common and debunked these myths.
“Bankruptcy doesn’t really get rid of debt.”
You probably think that bankruptcy doesn’t get rid of your debts and that sooner or later you will have to pay for it all. This is not true. Bankruptcy lets you get rid of certain debts completely, and you do not have to pay for those debts ever again.
“You will lose everything.”
Filing bankruptcy equals losing everything; that is a general perception. But, most Chapter 7 cases mean the debtors don’t have to surrender their possessions. Though exemptions vary from state to state, most states allow you to keep your possessions that are required for day to day living. If you own a flat-screen TV and a luxury car, your creditors are most likely to auction your car. You can talk to your bankruptcy lawyer to carve out your exemptions.
“You’ll never get credit again.”
If you think that filing for bankruptcy means you will never get credit again, then you are mistaken. Filing for bankruptcy is probably the best thing to do when you are losing control over your financial situation. Not filing for bankruptcy will harm your credit score. When you file for
bankruptcy you can get rid of your bad debts and start building on your credit score by paying your other bills on time.
“Everybody will know.”
You probably think that all your friends and neighbors will know when you file for bankruptcy. This is not true. People will come to know only if you tell them. Only your bankruptcy attorney and creditors would be aware of your situation.
“Your financial future will be in jeopardy.”
Again, this is not true. You may have to pay higher taxes and will have limited access to credit, until the time your credit score is restored. Your credit score will most likely get better after you file and then start paying your due’s in time. You may face certain limitations, but it certainly isn’t the end to your financial future.
“Both husband and wife have to file for bankruptcy.”
Most people assume that if you are married, then both you and your spouse have to file for bankruptcy, which is false. Both have to file only if they have combined debts. But, generally, only the person who has higher debts files.
“Creditors will harass you even after you file.”
According to bankruptcy laws, your creditors cannot keep calling you if you have filed for bankruptcy. So you can rest assured that you will not hear from your creditors after you have filed.
“You choose what to list as your debts when you file.”
If you think that you get to choose what to list when you file for bankruptcy then think again. According to the law, you need to list all your assets regardless of their status.
Contact a Bankruptcy Lawyer
If you are in a financial situation, understandably you’re going through a lot. And delaying things aren’t going to make life any easier. A reputable bankruptcy lawyer can help you navigate through the complex process of filing bankruptcy and make sure that you get a clean slate
to start life over again.
The bankruptcy lawyers at Cibik & Cataldo, P.C. are dedicated to helping our clients file for bankruptcy and settle their debt. With over 35 years of experience, we have provided debt relief assistance to over 20,000 people to give them a fresh start. Contact our legal team at (215)-735-1060 if you have any questions regarding filing or request a free consultation.
We are a debt relief agency that helps people
seek bankruptcy protection under federal law