Bankruptcy Myths You May Have Heard
Posted on: 21 February 2023
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If you feel overwhelmed by debt, filing for bankruptcy may seem daunting. However, many believe some inaccurate myths that may cause them to make poor decisions about pursuing this legal relief.
Myth: Bankruptcy Attorneys Only Fill Out Paperwork
One of the most pervasive myths about bankruptcy attorneys is that their job is simply to fill out paperwork. While this may be part of their job, they provide various other services and representation to their clients. For example, they can help you determine whether bankruptcy is the right solution for your unique financial situation and represent you in court. Depending on the facts of your case, they also help clients determine the best type of bankruptcy to pursue and negotiate with creditors.
Myth: Filing For Bankruptcy With An Attorney Will Take Too Long
Individuals may assume that pursuing bankruptcy will take too long to provide immediate relief. In reality, there are several important factors to keep in mind. Bankruptcy protection begins once the filings are made to the court rather than after the proceedings. This provides bankruptcy petitioners with relief from aggressive creditors. Additionally, a bankruptcy attorney can expedite the process by ensuring everything is done correctly. Mistakes with paperwork or missing important deadlines are common mistakes people representing themselves may make.
Myth: You Can Not File For Bankruptcy If You Have A Job
While individuals that have lost their jobs will often be forced to file for bankruptcy, this is not a requirement. Individuals that are fully employed can still qualify for bankruptcy protections. The type of bankruptcy they can pursue will depend on their circumstances. For example, a person that can continue making payments may negotiate their debt lower and create a sustainable repayment plan without losing their assets.
Myth: You Will Never Be Able To Get Credit Again If You File For Bankruptcy
While it is true that bankruptcy can impact your credit score, this does not mean these effects are permanent. Instead, individuals typically find that their credit can be rebuilt relatively quickly. Within a few years, most individuals will be able to qualify for new credit cards and other types of financing. However, this depends on maintaining a favorable credit profile, which includes making payments on time. A bankruptcy attorney can work with you to help you create a plan to achieve this goal. For example, these professionals often refer their clients to credit counseling, which can be highly educational and practical for rebuilding their finances after bankruptcy.
Contact a local bankruptcy attorney to find out more.