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Understanding the Myths of Bankruptcy

At times when a person hears the term bankruptcy, financial failure can immediately pop into their head. This idea is because most people have a misunderstanding of what bankruptcy actually is, and have only heard the many myths that are circulating rather than hearing facts. It is true that bankruptcy isn’t easy, but often times it is the best decision for you or your family to make. Here are a few myths to consider as you change your view about what filing for bankruptcy actually can mean for you. One of the biggest concerns is that a person’s credit will be ruined forever. This is simply not the case. Filing for bankruptcy will remain on your credit for the next ten years; however during this time period there is still the opportunity to improve your credit.

It is likely that if you are considering filing for bankruptcy that your credit is already in jeopardy, so why not take this next step towards financial debt freedom, even if it means it will take some time? Another myth regarding bankruptcy is that it is a challenging process and it is difficult to qualify for it. This may be the case if attempting to file on your own, though with the help of an experienced attorney you will be less stressed about the details and much more focused on the next steps to take towards changing your life around financially. A popular myth regarding bankruptcy is that when you file, every debt is diminished, while this would be nice, it is not the case. There are certain loans, such as student debt, and child support or mortgages that cannot be made obsolete.

There is still a responsibility to pay for those, though filing for bankruptcy may allow you a new payment plan in which this can be accomplished. It is also believed that those who file for bankruptcy are likely to lose everything that they own, and this is not true. Filing for bankruptcy will definitely cause you and your family to live and spend more frugally though it will not cost you everything. There are assets that are exempt from bankruptcy laws, and in many cases people don’t have to give up anything they own. Many fear that if they file for any chapter of bankruptcy that they will lose their job, and this too is not true in of itself. Technically speaking, no place of employment should discriminate upon their employees for being currently under bankruptcy. Unfortunately there are events in which they will chose other reasons to let go of an employee going through bankruptcy due to the law stating that it cannot be the soul purpose for dismissal. For this reason, having a personal bankruptcy attorney would be valuable to help protect you from discrimination in the workplace.

Lastly, many possible bankruptcy applicants fear that they will’ve be able to earn credit again in their life. This too is a myth. The consequence of filing for bankruptcy will cause you to have higher interest for a set amount of time, though it will not be forever. During the bankruptcy process, it is important to make sure that payments are done in the proper amount and on time; and good credit will be on its way in the future. Due to the uniqueness of each individual person and family, filing for bankruptcy is not a black and white contract, there are many details and facets to be sorted through and with the help of an attorney who has experience in this area it is possible. If you or someone you know is interested in filing for bankruptcy contact the Law Offices of David Cahn today for a free case evaluation!