There are a number of myths out there about the bankruptcy process. While some of these myths contain an element of truth, most have no basis in reality and were likely created to scare people. If you are navigating the bankruptcy process, it is a wise idea to contact an experienced bankruptcy attorney who can help you navigate this complicated legal world and help you distinguish myth from reality.
Myth #1: You Will Lose All Your Property Through Bankruptcy
In reality, many people who file for bankruptcy do not lose any of their property unless they choose to surrender items. As part of Chapter 7 bankruptcy, you have the option to keep property like your home and car while you continue to make monthly payments. If you are unable to qualify for Chapter 7 bankruptcy, you can still file for Chapter 13 bankruptcy, which will allow you to retain your property.
Myth #2: Your Spouse Must Also File for Bankruptcy
Spouses may file for bankruptcy jointly, but spouses can also file separately if the other spouse does not want to pursue bankruptcy. The origin of this myth is likely the fear that both spouses’ credit will be ruined if only one spouse files for bankruptcy. Simply not the case.
Myth #3: Tax Debt can Not be Discharged in Bankruptcy
While it is true that tax debts are often non-dischargeable, in some situations, they are. To determine if your tax debts are capable of being discharged in bankruptcy, ask a seasoned bankruptcy lawyer who can evaluate your particular situation.
Myth #4: You can Not Rebuild Your Credit After Bankruptcy
After declaring bankruptcy, you often must wait some time to rebuild your credit. In many cases, however, people who navigate the bankruptcy process discover that they are sent credit card applications shortly thereafter. In many cases, individuals who have learned how to handle their credit wisely are able to quickly rebuild their credit score.
Myth #5: Everyone Will Know About Your Bankruptcy
It is true that bankruptcy filings are a matter of public record. To find your bankruptcy, however, a person would need to know how to search for your particular bankruptcy filing and pay a fee to use the court’s filing program. Bankruptcies, however, are not published in newspapers, so your co-workers, employers, and friends often will not know that you filed for bankruptcy.
Contact an Experienced Bankruptcy Attorney Today
While it is possible to navigate the bankruptcy process on your own, if you make one mistake, there is a possibility that you will end up with all your original debt. For this reason, it is a wise idea to obtain the assistance of an experienced Michigan bankruptcy lawyer to help you navigate the bankruptcy process. Contact Resnick Law today to schedule an initial free consultation.
(image courtesy of Catherine Hughes)