Many people share some common misunderstandings and misconceptions about bankruptcy. Moreover, these myths can impact their ability to make good decisions. A consultation with Harris S. Ammerman Esq., a bankruptcy attorney in Virginia, Maryland and Washington, D.C., can help you fully understand bankruptcy. In the meantime, today’s article addresses some of the most common myths about bankruptcy.
A bankruptcy is often the best choice for those facing financial troubles or are having personal economic issues. When you have mounting debt, the bills are starting to pile, and your options can become limited. Unfortunately, common myths about bankruptcy can cause people to avoid this option. In order for you to make the best choice, you must separate fact from fiction.
Common Bankruptcy Myths
1. A bankruptcy means I will lose everything. – The truth is that most people who file for bankruptcy lose very little, if anything at all. Whether or not you keep your property depends on a number of factors, including the value and the exemptions available to you.
2. After bankruptcy, I will never have credit again. – While it is true that a bankruptcy will remain on your credit for 10 years, you can start rebuilding your credit within 6 months after the bankruptcy is discharged. The fact is, if you are filing bankruptcy, your credit score is probably already low. This is an opportunity to fix it.
3. You must be behind on your bills before filing a bankruptcy. – There is no requirement that you must be past due, in collections, or under foreclosure before filing for bankruptcy protection. You can protect yourself from ever receiving a harassing phone call from a debt collector.
4. Bankruptcy is only for losers who don’t want to pay their bills. – There is a lot of stigma attached to bankruptcy. Regardless, the most common reasons for filing have to do with life changing events. People choose bankruptcy for a variety of reasons, including the death of a spouse, divorce, a change in their employment, and more.
What haven’t we covered yet that is important to you? If you would like to talk about common myths about bankruptcy, or a related topic, please contact us.