Bankruptcy is a huge life decision, and people oftentimes have reservations about going forward with filing. This is completely understandable, as the stigma associated with bankruptcy, as well as a wealth of misinformation constantly transmitted to the public often work as deterrents. However, the truth is, bankruptcy can actually be an extremely useful tool for those who are suffering financially, which is why we have compiled a list of bankruptcy myths that simply are not true so you can get a better understanding of how (and not how) bankruptcy works. Please read on and reach out to our experienced New York bankruptcy attorney to learn more about bankruptcy myths and how we can help you going forward:
- You may go to jail for filing for bankruptcy. This is simply not true, as there are laws in place that clearly allow individuals to file for bankruptcy. In fact, thousands of people file for Chapter 13 or Chapter 7 bankruptcy every single year.
- You will lose everything you own. This is also completely false. In many cases, Chapter 7 bankruptcy completely discharges certain debts, allows you to keep your home and even all additional possessions. In Chapter 13 bankruptcy, on the other hand, you may keep all your assets, however, their value will get added into your repayment plan.
- You should pay off all your debts before filing for bankruptcy. Though to a certain extent, this rings true, if you find yourself in a situation where your debts are worth more than half of your annual income and you are incapable of paying those debts within five years, bankruptcy is most likely your best legal option.
- Bankruptcy will prevent you from getting credit: This may be true in some instances, however, you can generally secure a new line of credit soon after filing. Though it may be more challenging for the first few months, it’s not impossible.
- If you are married, you will both have to file for bankruptcy. Fortunately, this is also not true. You and your spouse do not technically share the liability for all debts accrued by one spouse. Therefore, if only one spouse is liable for debt, both spouses do not have to file for bankruptcy.
If you believe filing for bankruptcy is your best option going forward, please do not hesitate to contact our knowledgeable bankruptcy firm.
Contact our experienced New York firm
Bankruptcy, for many people, is a frightening endeavor. Fortunately, with the help of an experienced attorney, it does not have to be. If you require the services of an experienced Business Law or Bankruptcy attorney, contact the Law Offices of Allen A. Kolber, Esq. today to schedule a consultation and discuss your options. We will have your back every step of the way.