As bankruptcy attorneys who have helped thousands of people get debt relief through bankruptcy, we know that many people fear filing for bankruptcy because of myths and false misconceptions about what bankruptcy can and cannot do. In actuality, there are more benefits to filing bankruptcy than you may think. Below, we dispel 5 of the common bankruptcy myths.
Myth 1: The Bankruptcy Process is Overwhelmingly Difficult
Not true. An experienced bankruptcy attorney can do the heavy lifting for you and make the process a straightforward experience. With over thirty years of experience in the area of bankruptcy law, our attorneys know how to skillfully navigate clients through the bankruptcy process. We are often told by our clients that couldn’t believe how easy we made the process for them.
Myth 2: Borrowing to Pay Off Debt Is Better Than Filing Bankruptcy
Not true. People often wait to file for bankruptcy for too long, often creating much anxiety as they watch their debts grow and grow. In trying to avoid bankruptcy they will sometimes resort to poor decisions such as using their retirement accounts (which they would not lose in the bankruptcy), opening new credit cards to shift debt, taking out bad loans, or selling property that would be protected in the bankruptcy.
This is usually short sighted, stressful, and often does not eliminate the debt. In contrast, filing for bankruptcy protection under Chapter 7 not only gets you an automatic stay, but also allows you to discharge qualifying debts in a matter of months.
Myth 3: I Will Lose My Home and My Property if I File Bankruptcy
Not true. Many people believe that they will have to sell their house and possessions if they file for bankruptcy. In our practice, the overwhelming majority of our clients who file under Chapter 7 give up no property. These “no-asset” bankruptcy cases are possible because of exemptions that we use which allows you to keep property like your house or your car. In addition, creditors have little interest in your personal property, like your clothes, your television, or your furniture.
Myth 4: People Who File Bankruptcy May Go to Jail
One common bankruptcy myth is that debtors often go to jail. As long as you are truthful in your bankruptcy paperwork you have nothing to fear.
Myth 5: I Will Never Get Credit Again
Again, this is false. While bankruptcy appears on a credit report, if you have significant debt and are unable to pay your bills you likely have poor credit which will not get better on its own. Bankruptcy provides a discharge of many types of debt obligations and paves the way for a better financial future. In fact, you may be able to get a new credit card right after bankruptcy. In fact, we provide our clients with information on how to restore their credit moving forward after their bankruptcy discharge.
Contact a Bankruptcy Attorney to Get Your Questions Answered
The attorneys at Levitt & Slafkes, P.C. have extensive experience helping individuals and small businesses through bankruptcy and beyond. Avoid falling into the trap of believing these and other common bankruptcy myths by speaking to a knowledgeable bankruptcy attorney. Call Levitt & Slafkes, P.C. today at (973) 323-2953, or reach us online to schedule a free consultation.
We are proudly designated as a debt relief agency by an Act of Congress. We have proudly assisted consumers in filing for Bankruptcy Relief for over 30 years.