Common Bankruptcy Myths

Below are some of the most common myths that people believe about filing bankruptcy and the bankruptcy process overall.

Filing Bankruptcy Means I’m a Failure

There is an old saying that “bad things happen to good people.” Every single day good people experience difficult situations: spouses pass away, people become ill or have medical emergencies, lose their jobs, and get divorced. These are just a few examples of unforeseen life-changing events that most of us have no control over. These events often carry with them devastating financial results. If something like this happens to you, bankruptcy can be a way forward and help you get back on your financial feet. No one should be ashamed of having gone through hard times or using the bankruptcy laws to help get through them.    

I’ll Never be Able to Get Another Credit Card

This simply is not true. The reality is that once you file bankruptcy, lenders will often seek you out to offer you new credit cards.  These new credit cards will often carry higher than normal interest rates and have low credit limits, but they are a good to help you reestablish good credit.  The key for your success will be to keep the new credit balance low and pay off the card each month. Since you’re eliminating your old debt in your bankruptcy case, lenders often look at you as a good credit risk.   

I’ll Lose All My Property if I File Bankruptcy

This is not true.  The Bankruptcy Laws are very complex, with many nuances. The reality is that there are no cookie cutter bankruptcy cases. Each and every case is different, dependent on the person’s individual and financial circumstances.  There are laws, both federal and state, specifically designed to protect many of your assets.  The experienced bankruptcy attorneys at Gold, Lange, Majoros & Smalarz, P.C. can walk you through how these laws can best suit your needs. 

I Can File Bankruptcy on My Own

Abraham Lincoln once said: “a person who represents himself has a fool for a client.”  This old adage still rings true, especially in the context of our bankruptcy laws.  People who attempt to file bankruptcy on their own often find themselves in even worse situations, and can even lose assets they shouldn’t have to. It is extremely important to speak with an experienced bankruptcy attorney before you make the decision to file.  Whether you’ve already filed a bankruptcy case on your own, or are thinking of doing so, we can help!

I’ll Never Be Able to Buy a House or Car Again if I File Bankruptcy

Not true! Most people will have no problem buying or leasing a new car after they’ve gone through bankruptcy, especially if you are working or have another steady stream of income to make your car payments.  With your debt eliminated, many lenders view you as a better credit risk! It make take around two years before you can purchase a new home, but that often depends on what you do after your bankruptcy to generate income and reestablish your credit.     

My Spouse is Going to Have to File Bankruptcy With Me

Not true! Your spouse is not required to file bankruptcy with you if they do not want to. The most important things to remember are that if you file bankruptcy and your spouse does not, your spouse generally will not receive any of the creditor protection that you will, and your spouse will remain legally responsible to repay his/her debts, even debts that were joint with you. In some situations, it may be in your spouse’s best interest to file with you. 

Bankruptcy Will Ruin My Credit Forever

If you’re filing bankruptcy, chances are that your credit is already not the best.  By filing bankruptcy, you can eliminate your debt and start down the road of rebuilding your credit.  Your credit will drop at first once you file bankruptcy, but over time it will increase as long as you pay your post-bankruptcy debts.

I Can’t Discharge Tax Debts

In many instances you can’t discharge tax debts, but some tax debts are dischargeable.  Our attorneys will walk you through a detailed step by step analysis of your income tax obligations and determine what taxes you be able to discharge in bankruptcy.

The Bankruptcy Process is Too Difficult

There is no one size fits all bankruptcy. Each case is different depending on your personal and financial situation.  Let our attorneys meet with you to analyze your specific situation and advise you on how best to achieve your goal of becoming debt free. 

Any Lawyer Can Handle My Bankruptcy Case

Would you go to a foot doctor for chronic pain in your ear? The Bankruptcy laws are very complex, and not just any attorney can properly guide through the process. Our attorneys have over 100 years of combined bankruptcy experience. Let us put that experience to work for you. To get started, contact us today for assistance.