22
Dec

Bankruptcy Myths

There is a stigma that can easily be associated with filing for bankruptcy, as well as many misconceptions about how it will affect a person’s future. The best way to learn all there is to know about Chapter 7 and Chapter 13 bankruptcy, and what the pros and cons are, is to discuss your financial situation with a knowledgeable and experienced attorney.

Common Myths about Bankruptcy

 

Myth: If I file bankruptcy, everyone will know.

​​Truth: While bankruptcy is a public process, it’s likely that the only way anyone would know is if they ran a credit check on you. The creditors that are involved with the bankruptcy will be notified, but unless you tell others, it can be a private legal matter between you and your lawyer.

 

​Myth: I will lose everything I own if I file for bankruptcy and be left with nothing.

Truth: It’s true that Chapter 7 bankruptcy can include the liquidation of some assets to satisfy creditors, but this doesn’t mean that you will lose everything. There are certain items that can be considered bankruptcy exemptions, including your home. Chapter 13 is a reorganization of debts and allows you repay them over a certain period of time. Those who file this type of bankruptcy generally do not have to liquidate any of their assets.

 

Myth: I will never be able to get a line of credit again if I file bankruptcy. 

Truth: Bankruptcy was designed to help individuals and spouses regain their financial solvency, not to penalize them forever. In some cases, the best and most responsible thing a person can do is go through the bankruptcy process and then get educated on how to try and avoid similar situations in the future. When the bankruptcy is done, you will have the ability to rebuild your credit over time once again.

 

Myth: What if I need to file bankruptcy in the future? Isn’t this a once in a lifetime opportunity to make a fresh start and get ahead?

Truth: You can file chapter 7 Louisiana every eight years and Chapter 13 even sooner, if a future situation made it necessary. Our firm can help you with the preparation and filing of your bankruptcy and provide you with guidance to help you through the process.

Bankruptcy Myths

There is a stigma that can easily be associated with filing for bankruptcy, as well as many misconceptions about how it will affect a person’s future. The best way to learn all there is to know about Chapter 7 and Chapter 13 bankruptcy, and what the pros and cons are, is to discuss your financial situation with a knowledgeable and experienced attorney.