man in suite on laptop and looking at scattered papers and calulator

Myths About Declaring Bankruptcy

Are you in financial trouble? Is your debt starting to become too much and making day-to-day life stressful and overwhelming? Then perhaps you should consider filing for bankruptcy. There are a lot of myths and falsehoods about bankruptcy that many people believe, but if you’re considering filing for bankruptcy, you should know that these myths are simply not true. 

[Read More: Can I Get a Car Loan After Bankruptcy?]

You Will Lose Everything 

Some people think filing for bankruptcy means that they’re going to lose everything they own from their house to their car to their TV. In fact, most chapter 7 bankruptcy cases are no-asset cases, which means you get to keep your basic assets. In chapter 13 bankruptcy, you get to keep all your assets.

You Can Only File for Bankruptcy Once in Your Life 

If you have already filed for bankruptcy before and think that you can never again do it, you’re wrong. You can receive a discharge from a chapter 7 bankruptcy once every eight years. In the case of chapter 13 bankruptcy, you can receive a discharge every two years.

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Filing for Bankruptcy is too Expensive for Most 

Although there are some filing fees that are a few hundred dollars, filing for bankruptcy is generally not that expensive. However, hiring an attorney to help guide you through the process could be pricey, but it is likely still more affordable than trying to pay off debts with high interest rates and penalties.

Your Credit Future is Ruined Forever 

Many people think that filing for bankruptcy is the end of their credit lives, but that is not true. Almost immediately those that have filed can begin rebuilding their credit when the bankruptcy is closed. If you’re worried about your credit score, in some cases it can actually improve after bankruptcy since it helps eliminate consequences from unpaid debts. 

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