The decision to file for bankruptcy is not an easy one and many people experience stress when faced with the decision to file. The reason is that there are many myths that surround bankruptcy, which prevent people from benefiting from the outcomes that bankruptcy can provide.
My Assets Will Be Liquidated
Most people fear bankruptcy because they are unsure what will happen to their assets during the process. The truth is, there are federal and state bankruptcy laws that allow for much of your property to be protected from liquidation in bankruptcy. Federal bankruptcy laws can protect a home up to $125,000, one car per family and up to about $10,000 worth of personal property. Each state has different bankruptcy exemption laws, but some states allow for a home of any value to be protected, a car per licensed family member any up to $30,000 worth of personal property. A bankruptcy attorney can help you determine which exemption law would best protect your property during the bankruptcy process.
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My Credit Will Be Ruined
You may have heard that a bankruptcy stays on your credit report for up to 10 years. While this may be true, it doesn’t mean that your credit will be damaged in the process. The truth is, the majority of damage done to your credit happens long before you file for bankruptcy. Delinquent accounts and negative account histories are the most damaging to a credit report. After a bankruptcy, your accounts are no longer considered delinquent and your credit history has been erased to start fresh. Most people find that their credit improves after bankruptcy.
My Reputation Will Be Tarnished
A common fear that people hold about bankruptcy is that their friends, family, neighbors and employers will find out about their bankruptcy. The truth is, none of these people will find out unless you tell them. Bankruptcy is a matter of public record, but that refers to the fact that the information is publically available for legal and court purposes. No one will put a sign in your yard or mark your personal file with a scarlet “B”. Even further, bankruptcy laws prohibit employers discriminating against you based on a bankruptcy. If an employer was to find out and discriminate against you in any way, you would have legal recourse against that employer.
My Future Of Getting Credit Will Be Compromised
Many people worry they will not be able to get credit after a bankruptcy. The truth is, many lenders are willing to offer credit to consumers post-bankruptcy. You may not get the biggest line of credit with the best interest rate, but you will surely be able to obtain financing again soon. The best way to get back on track for new credit is to obtain a small, manageable credit balance and make timely payments. The more positive payment history you can prove, the better your chances of obtaining an ideal loan in the future.
Christopher Lee, of Lee Law Firm, understands that financial hardships can affect honest, hard-working people. His early experience growing up in a very blue collar family in a rural area of Indiana, made a significant impression on his business philosophy today. As a child, he watched his family struggle as money didn’t come easy and his parent work hard to provide for their family. As a bankruptcy attorney in Dallas, Tx his practice has given him the opportunity to directly impact the lives of many people. For more information visit: http://leebankruptcy.com
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