Filing for bankruptcy is a big decision. Fortunately, many of the fears surrounding this process are based on myths or misunderstandings of what bankruptcy involves.
There are hard decisions to make during the bankruptcy process, but a successful outcome greatly improves your financial situation and quality of life. The best way to calm your fears and dispel any myths about bankruptcy is to work with an experienced attorney in Jacksonville.
Myths Concerning a Complete Loss of Assets
Arguably the most common myth about the bankruptcy process is that you’ll lose all of your assets once you file. The reality is that bankruptcy typically does not result in the loss of any of your property. Many items like family heirlooms are exempt, and other exemptions can protect additional assets depending on the type of bankruptcy you file. You can even renegotiate debts in a way that allows you to stay in your home or keep your car even after the bankruptcy is discharged.
Misconceptions of Creditor Harassment
When you file for bankruptcy, you are immediately protected from harassment by creditors through an “automatic stay.” This function of the bankruptcy process prohibits creditors from contacting you. This protection lasts until your debts are discharged, at which time most creditors are barred from contacting you.
Eligibility for Future Loans
It is true that a bankruptcy filing impacts your credit, and in some cases, you’ll have trouble getting a loan. Traditional lenders tend to avoid lending money to people who file for bankruptcy for up to four years after the filing. However, Parker & DuFresne, P.A. will help you rebuild your credit after bankruptcy using our credit rebuilding program. Improving your credit score after filing for bankruptcy reduces the challenges you’ll face when applying for a loan.
Myths Involving Spouses Filing for Bankruptcy Together
Another common misconception that stops people from filing for bankruptcy is that both spouses must file together. This is not true, and there is no rule that stops one spouse from filing for bankruptcy if the other does not. As a matter of fact, in Florida, property acquired during the marriage is considered to me owned “by the marriage” (known as Tenants by the Entireties), and such property is NOT part of eth bankruptcy estate if only one spouse files. It is critical to talk with an experienced Florida bankruptcy attorney to determine if both spouses should file.
Minimum Amount of Debt
There is no minimum amount of debt that you must have to file for protection under the bankruptcy code. However, there is a “means tests” for anyone seeking to file Chapter 7 bankruptcy. Unsure whether you’ll quality? Consult with a skilled local lawyer to determine whether you’ll pass the test.
Talk to an Attorney About Bankruptcy Myths in Jacksonville
These misconceptions sometimes keep you from filing for bankruptcy even when there are real benefits in doing so. Don’t be swayed by myths or urban legends about bankruptcy in Jacksonville. Instead, put yourself in a position to make an informed decision by calling one of our qualified legal professionals.