Bankruptcy often carries a heavy weight of misunderstanding. Many individuals grappling with debt find themselves tangled in a web of myths about this legal process.
This blog aims to highlight common bankruptcy myths and provide clarity for those considering this option. Whether you are overwhelmed by bills or simply exploring your choices, this blog may help you separate facts from fiction.
3 myths about bankruptcy
One common misconception about this process is that you may lose everything you have if you file. However, a lot of property in a bankruptcy filing is exempt, and you may rarely lose anything at all.
While assets exempted vary from state to state, common exemptions include the debtor’s house, cars and clothes. Moreover, creditors often do not even want some of the assets that are covered.
Another common bankruptcy myth is that it kills your credit forever. While your filing will remain on your record for seven to ten years, the impact on your credit is temporary. You may even receive low-limit credit card offers weeks after your debt discharge.
Filing for bankruptcy also does not afford you a spending spree. Some people believe that since the process dissolves credit card debt, they may spend recklessly without paying that money back.
Debtors should know that racking up charges ahead of a bankruptcy filing is fraud. Moreover, courts will not discharge the debt you incur due to fraudulent activities.
Your path to financial freedom
For people overwhelmed with debt, bankruptcy can be the beginning of a new financial journey. By debunking these common myths, we aim to offer a clearer picture of how this process may help you.
If you are struggling with debt, it is wise to explore your options without letting misconceptions cloud your judgment. Consider speaking with a qualified bankruptcy attorney who can provide essential advice based on your specific circumstances. With the right information and guidance, you can make an informed decision about your future.
