For many individuals, making the decision to file for bankruptcy may be difficult. There is a stigma associated with bankruptcy that is hard to ignore. However, there are also many myths floating around the process that may be holding individuals back when the process could benefit them. To learn the top five most common myths about bankruptcy, continue reading. If you are looking into filing bankruptcy, do not hesitate to reach out to our experienced New York bankruptcy attorney.
What are the most common myths about bankruptcy?
- Bankruptcy can prevent you from getting credit: It may be more difficult to secure a new line of credit within the first few months of filing, but you can typically secure a new line of credit relatively soon. There are certain situations that may prevent you from getting credit, but this is not a common occurrence.
- You will lose your belongings: Chapter 7 bankruptcy discharges certain debts while allowing you to keep your home and all additional possessions. If you are filing Chapter 13 bankruptcy, you may keep all your assets, but their value will be added to your repayment plan.
- You could go to jail if you file for bankruptcy: There are laws in place that allow individuals to file for bankruptcy. Thousands of individuals file for Chapter 13 and Chapter 7 bankruptcy every year.
- You have to pay off all of your debts before filing for bankruptcy: It is recommended that you pay off your debt before taking the plunge in filing for bankruptcy. However, if your debts are worth more than half of your annual income and you are not capable of paying this debt off within five years, bankruptcy is most likely your best legal option.
- You and your spouse will both have to file for bankruptcy: When debt is accrued by one spouse, this does not mean that their spouse will have to share liability. When one spouse is liable for a debt, both spouses do not have to file for bankruptcy.
If you are considering if bankruptcy is right for you and your financial situation, reach out to our New York bankruptcy attorney who will help you to decide which path is best for you. Give our firm a call today to learn more about our services and how we can assist you. We are here to help.
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.