7 Bankruptcy Myths
The following are seven bankruptcy myths in case you’re thinking about filing for Chapter 7 bankruptcy or even a chapter 13 bankruptcy.
- Myth #1 If you file a bankruptcy you’re going to lose all of your property –
That’s simply not true a lot of times clients are in fact worried that they’re going to lose their home or their car or their furniture or their jewelry if they file a bankruptcy or the court is going to go ahead and grab it and use that to pay the creditors and again that’s just a bankruptcy myth. You are able to protect your property in most instances if you file for chapter 7 bankruptcy or if you file for chapter 13 bankruptcy.
- Myth # 2 You’re going to be ruined and you’re never going to get credit again –
That’s simply not true either a lot of times I have clients presently in their chapter 7 bankruptcy case and believe it or not they are currently being solicited by the credit card companies for new credit card offers. Even though their chapter 7 bankruptcy case is not completed and in addition to that also a lot of times clients after they complete their chapter 7 bankruptcy you are able to get a mortgage a lot of times it’s within at least two years following the discharge of your chapter 7 bankruptcy or the completion of your bankruptcy case.
- Myth #3 You’ll be ruined financially for 10 years –
I think that myth comes about because the fact of filing bankruptcy is on your credit report for up to 10 years. Often times we have clients within a couple of years of filing their bankruptcy case, particularly chapter 7 bankruptcy where they’re able to go ahead and buy a new car they’re able to go ahead and buy a vehicle qualify for a mortgage or get the furniture or the property that they’re trying to get and one of the reasons for that is of course that once you’re completely debt-free you’re a good credit risk because you don’t have a lot of other debt.
- Myth #4 You get to pick and choose what to list in your bankruptcy
In other words, sometimes people say well I don’t want to list my house in bankruptcy or I’m not going to put my house in the bankruptcy I’m not going to put my car in the bankruptcy that’s a myth you don’t get to pick and choose.
All creditors have to be treated equally but people get worried about putting or listing their house or putting their vehicle in the bankruptcy. Because they’re worried that they will lose that property and again the fact that you listed creditors such as your mortgage company or your vehicle company does not mean that you’re going to lose that vehicle it doesn’t mean that you’re going to lose your home. It just means that all the creditors have to be listed. The court has to know your entire financial picture.
- Myth #5 You cannot discharge or wipe out income taxes when filing for bankruptcy protection –
That’s another myth! In some limited circumstances depending on your particular situation, you might be able to wipe out income taxes completely in your bankruptcy case. In order to have that evaluated, you’ll need to bring of course all of the correspondence you’ve received either from the state taxing authority or from the IRS to your bankruptcy attorney so that he or she can evaluate the information.
- Myth #6 You will never be able to purchase a home or car again –
I think we’ve just covered that it’s completely false. A lot of times I have clients within a very short period of time probably 30 60 90 days out when they’ve completed their chapter 7 bankruptcy case and they are able to go ahead and purchase a new vehicle. Even sometimes most of the time it’s approximately two years before you can qualify for a mortgage again but I’ve had clients that have qualified within a year or so.
- Myth #7 If you are married you have to both file bankruptcy –
The final myth that I wanted to talk about today and the thing that worries people is that if you’re married there’s a myth out there that you know you have to file the bankruptcy case with your spouse and that’s not true. The fact that you might have to do a lot of things together if you’re married but filing bankruptcy together is not one of them.
These 7 bankruptcy myths are just that…myths…they are totally untrue. Most of the time well-meaning family and friends will tell us one of the above myths thinking they are helping us. But at the end of the day, your financial future is your responsibility. Find out today if bankruptcy is your best option.
When you contact Fisher-Sandler today. We will set you up with a free consultation, where we will sit down and go over your financial situation. Afterward, I will give you my professional opinion regarding your finances, and whether it is in your best interest to file bankruptcy. If, after going over all your paperwork, it looks like bankruptcy is not your best option I will let you know.
There are other options available if bankruptcy is not the best route for you to go. Maybe debt consolidation is a better route or a mortgage loan modification, student loan modification, etc. But the only way to find out is to call.
We are available 24 hours a day 7 days a week. You can easily schedule your free consultation whether on our website or by calling one of our office phone numbers below. We look forward to speaking with you soon and helping you get the fresh start you deserve.
12801 Darby Brook Ct #201
Woodbridge, VA 22192
3977 Chain Bridge Rd #2
Fairfax, VA 22030
Fisher-Sandler, LLC – Richmond, VA
8002 Discovery Drive, Ste. 422
Richmond, VA 23229
Fisher-Sandler, LLC – Fredericksburg, VA
1930 William Street
Fredericksburg, VA 22401