Even though you don’t dream of the day when you finally file for bankruptcy, it may be the best way to regain control of your finances. As you learn more about the process, you can decide if now is the best time to take action.
Many people are interested in bankruptcy but neglect to push forward because they’ve yet to separate fact from fiction. Here are a handful of bankruptcy myths that could slow you down:
- Assuming you’ll lose everything: Just because you file for bankruptcy doesn’t mean you’ll lose your home, cars and any other possessions you’ve gathered. With the help of exemptions, you can hold onto many or all of your assets.
- You can eliminate all your debt: Even though bankruptcy allows you to reduce or eliminate some debts, this doesn’t hold true for all of them. For example, bankruptcy has no impact on student loans or child support.
- Your financial future is over if you file for bankruptcy: A bankruptcy filing will remain on your credit report for a minimum of seven years, but you can take steps to restore your credit as time goes by.
As you learn more about the bankruptcy process, it’s much easier to prevent these types of myths from getting in your way.
If you’re interested in filing for bankruptcy, learn more about both Chapter 7 and Chapter 13. As you compare the pros and cons, you’re likely to find that one type makes more sense for someone in your position. When you’re ready, you can turn your attention to the process itself and your legal rights as a consumer.