Many consumers in Michigan and around the country don’t file for bankruptcy because they don’t have enough accurate information about it. There are a lot of misconceptions about bankruptcy that simply aren’t true. Here are some of the bankruptcy myths that many people fall for.
Both spouses need to file
Many married people have the misconception that they only can file for bankruptcy if their spouse does as well. However, someone can file by themselves despite the fact that they are married. This often happens when one spouse has a lot more debt than the other.
It permanently ruins your credit
Your credit will take a hit during bankruptcy, but it will slowly recover from it. A bankruptcy can stay on your credit report for up to 10 years. It generally does have less of an impact over time. Many individuals do find that they can get approved for things like a credit card, car loan, or even a home mortgage within 3 years after filing for bankruptcy.
Filers can frivolously spend a lot of money right before filing because they won’t need to repay it
One of the biggest myths about filing for bankruptcy is that you can frivolously spend a lot of money beforehand without ever having to pay any of this debt back. Unfortunately, this is considered fraud, and it won’t be included as part of the bankruptcy.
If you can no longer afford to pay all of your debts, you may want to consider filing for bankruptcy. Despite it being in their best interests, many individuals put off doing so because of all of the misconceptions about the process and its aftermath.