The stigma around filing bankruptcy is widespread, and many people are afraid of the process because of it. With the right attorney and understanding on your side, bankruptcy is not something to fear. If you are struggling with a significant financial burden, it may be the right decision to help you get ahead of your debt.
There are many myths surrounding bankruptcy that cause people to view it negatively. They arise from misunderstands and lack of education on the topic. We at Parker & DuFresne want you to be gain enough knowledge about bankruptcy so you can improve your financial situation. Here are five common myths that surround filing bankruptcy:
1. Your Credit Status Will Be Damaged for a Long Time
While your credit may drop initially, bankruptcy causes a debt discharge that will improve your credit in the long-term. Filing bankruptcy means that your credit has most likely already been damaged. While a bankruptcy stays on your credit report for 7–10 years, you can begin to rebuild your credit as soon as the court discharges your debt.
It is essential to make your payments on time and thoroughly. Additionally, your income to debt ratio should be kept low to ensure you do not fall into the same issues as before.
2. All Your Friends and Family Will Know You Filed for Bankruptcy
A bankruptcy filing is public record, but there are not that many people who are actively searching through files to see who has declared bankruptcy. The only people that will know are the people you tell and the people working with you through the case.
3. Filing Bankruptcy is Too Difficult
The paperwork that comes along with bankruptcy is extensive, and the time frame for the case is long. While these aspects are challenging, the right lawyer can make the process ten times easier for you and any parties involved. It is especially important to let your attorney know everything they need to know about your finances so they can give the most useful advice.
4. You Won’t Be Able to Own Property Again
Immediately after filing bankruptcy, it may be difficult to purchase a property. There will be credit card companies that will offer cards right after the discharge of your debt. Rebuilding your credit can overcome any financial difficulties.
5. You Are Limited to File Only Once
The amount of times you can file for bankruptcy does not have a limit. While you have a federal waiting period, you can file again after your debts are discharged. You are required to wait eight years for the second filing of Chapter 7 and two years for filing Chapter 13.
Offering Sound and Compassionate Bankruptcy Guidance
Bankruptcy is not a scary and challenging situation with the right attorney. Parker & DuFresne will work with you as you are filing bankruptcy. Our team of attorneys is dedicated to representing you and educating our clients on the truth of bankruptcy. Contact us today.