The world is full of false information regarding declaring bankruptcy. We firmly advise speaking with a bankruptcy lawyer who can provide you with the facts before you believe them. Some of the most prevalent myths we have observed are listed below.
Myth: Bankruptcy Is Not An Option
Although the bankruptcy laws changed in 2005, most relief is still available. It is accurate to say that it can be more difficult, but it is feasible. Working with a bankruptcy lawyer who can expedite costs is essential.
Myth: Medical Bills Cannot Be Discharged
False. Some may falsely assert that medical bills cannot be discharged in bankruptcy. Almost all unsecured contract debt, including credit card debt, personal loans, and medical expenses, may be discharged during a bankruptcy petition.
Myth: You Have To Repay Everything In Full If You File For Chapter 13
Different Chapter 13 plans exist. Some require no payment to general unsecured creditors, while others demand full payment. If you file for Chapter 13, your final payment will rely on your disposable income, the value of non-exempt assets, and priority obligations.
Myth: You Will Have Horrible Credit For Ten Years After Filing For Bankruptcy
No. While their case is pending, a person who filed for Chapter 13 may be able to borrow money. After being discharged, a person who files for Chapter 7 is likely to begin receiving credit card offers. While the interest rate may be higher, they can start establishing credit right away. Even though bankruptcy filings are recorded for ten years under the Fair Credit Reporting Act, this does not preclude a person from obtaining credit. As long as steps are taken to reestablish their credit after the bankruptcy is discharged, their credit score will improve.
Myth: Filing For Bankruptcy Means You Will Lose Everything
Most people who file for bankruptcy have “no-asset cases,” meaning they keep everything they own. Why? Because there are exemptions that allow the debtor to preserve their assets. For instance, no bankruptcy trustee or creditor has access to pensions.
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Call Winterbotham Parham Teeple, a PC at 800.400.9000 right away to learn more about the assets you can keep, those you might have to give up, and which bankruptcy option is right for you.