Common Myths about Bankruptcy

Bankruptcy is always getting a bad wrap due to the fact that there are so many untrue statements about the process.  In order to understand bankruptcy it helps to do research on the procedure. Bankruptcy has helped thousands of consumers gain control of their financial situations. Many people are quick to downplay bankruptcy as an option simply because of something they have heard that’s not true.  The following are the most common myths related to bankruptcy.

  • All of my debt can be wiped off during bankruptcy. Not true.  Certain debts may not qualify for discharge such as child support and student loan payments.
  • Filing for bankruptcy will cause me to lose my home and other assets.  Not true.  In many cases, filing has helped consumers keep their home and personal property through exemptions set by the state. Most consumers are able to keep their house and vehicle as long as they continue making payments.
  • Bankruptcy will ruin my chances of getting credit.  Not true.  The process helps many people obtain a clean slate.  Many time consumers find that after filing bankruptcy they have a better chance of maintaining credit.
  • Married couples have to file together.  Not quite.  It often depends on what state you live in and the debt in question.  The debt may be separate from joint debt accumulated; meaning the accounts in question may belong to one spouse and therefore they may choose to file alone.
  • Bankruptcy can only be filed one time. Not true.  While there are time limits which vary depending on the Chapter filed you can file more than once.

Questions and concerns should be discussed with a licensed bankruptcy attorney .