Common Myths & Misconceptions About Bankruptcy
March 29, 2022
If you feel overwhelmed and drowning in debt, you might be contemplating filing for bankruptcy. Many people who struggle with debt get caught up in what they believe to be true about bankruptcy. However, the problem is that there are many myths and misconceptions out there about filing for bankruptcy. Many of these bankruptcy misconceptions prevent people from getting the debt relief they need.
If you are thinking about your debt relief options, our attorney at the Law Office of Robert L. Firth can help. Our bankruptcy attorney in Cathedral City, California, will review your particular situation to determine whether or not filing for bankruptcy is right for you. We also assist debtors throughout the Coachella Valley, including Palm Desert, Palm Springs, Rancho Mirage, Desert Hot Springs, and the rest of California.
Misconceptions & Myths About Bankruptcy
There are many misconceptions and myths about bankruptcy that add confusion to filing for bankruptcy and prevent people from understanding their legal rights. Some of the most common bankruptcy misconceptions include:
It is embarrassing to file for bankruptcy. Some people feel embarrassed about filing for bankruptcy, thinking that bankruptcy would make them look like a failure. However, there is nothing to be ashamed of because anyone can experience financial difficulties. Sometimes, filing for bankruptcy is the only way to take control of your financial situation.
You will never get credit after you file for bankruptcy. Bankruptcy can remain on your credit report for up to 10 years. However, just because bankruptcy can stay on your report for up to a decade, it does not mean that you will never be able to get credit again. In fact, filing for bankruptcy can be an opportunity to rebuild your credit as you pursue a fresh start.
You will lose everything if you declare bankruptcy. Contrary to popular belief, a debtor does not lose everything after filing for bankruptcy. In fact, most people who file bankruptcy are able to keep most, if not all, of their assets. Seeking legal counsel from an attorney before declaring bankruptcy can help you keep your assets.
My spouse will have to file for bankruptcy, too. Under bankruptcy law, married individuals can declare bankruptcy individually or jointly with their spouse. Often, filing jointly has many benefits. Whether or not you should declare bankruptcy along with your spouse depends on whether you have joint debts, the amount of secured and unsecured debts, and many other factors.
You can file for bankruptcy once in a lifetime. You can file for bankruptcy more than once as long as the mandatory waiting period has passed after the date of the last filing. For example, you can obtain a discharge of debt under Chapter 7 bankruptcy every eight years.
Filing for bankruptcy will discharge all of my debt. Not true. For many people, filing for bankruptcy is their only opportunity to get relief from debt. But not all debts are discharged when you declare bankruptcy. When filing for bankruptcy under Chapter 7, a debtor can discharge almost all of the unsecured debts, including medical bills, personal loans, utility bills, and others. However, some debts—such as child support and alimony debt and tax debt—can never be discharged in bankruptcy.
Filing for bankruptcy is easy. Filing for bankruptcy is not as straightforward as it may seem. The bankruptcy process involves a lot of paperwork, which makes it more difficult to get debt relief. Fortunately, you can make the process easier by getting legal help from an experienced attorney.
Consult with a Bankruptcy Attorney
At the Law Office of Robert L. Firth, our bankruptcy attorney in Cathedral City has helped thousands of people throughout the Coachella Valley and the rest of California relieve the burden of crushing debt. Schedule a case review with a bankruptcy attorney to sort through your financial situation and explore your debt relief options.