Filing bankruptcy can be overwhelming. Fear and common misconceptions often prevent those struggling with finances to take the first step and speak to bankruptcy lawyer. I’m here to help you sort out the facts from the fiction and to understand what your options are.
Myth: I cannot file bankruptcy if I owe back taxes.
Reality: The bankruptcy court will examine all debt, including tax debt. In fact, some back taxes may be included in Chapter 7 and Chapter 13 bankruptcy.
Myth: My credit will be ruined for at least 10 years if I file for bankruptcy.
Reality: You can rebuild your credit within a couple of years if you continue to pay your monthly bills on time.
Myth: Wage garnishments will continue after I file for bankruptcy.
Reality: As soon as you file for bankruptcy, garnishments will stop immediately.
Myth: I will lose my house and car if I file for bankruptcy.
Reality: Most times, you will not lose any of your assets. Filing Chapter 13 is a good option for people who want to keep their home if it has high equity.
Myth: After the strict laws that passed in 2005, I will not qualify for bankruptcy.
Reality: This is fundamentally untrue. Eligibility for both Chapter 7 and Chapter 13 are based on the MEANS test, which analyzes your debt, income, and assets. The truth is, if you qualified under the old laws, you probably still qualify today.