Don’t Let Bankruptcy Myths Keep You in Debt
Bankruptcy lawyers in San Bernardino, CA dispel myths that cloud your financial future
At Invictus Law, P.C., an attorney from our Santa Ana or Ontario, California office helps you understand bankruptcy options and processes. It’s our job to shatter any existing beliefs that do not present bankruptcy as an attractive alternative to living with the stress and burden of overwhelming debt. And our legal team’s goal is to help you overcome obstacles.
Myth 1: Bankruptcy means you lose everything you have
If you are eligible to file under Chapter 7 bankruptcy, you liquidate your assets to pay off creditors. But, if you do not pass the means test and if you earn a regular wage, you can file under Chapter 13, which allows you to keep your house. One of our bankruptcy attorneys can advise you about which bankruptcy option is best for your individual situation and which assets you can hold on to.
Myth 2: Bankruptcy means you can’t ever own anything again
There is nothing to prevent you from owning a home, a car or personal belongings. But it is a good idea to include these items in your financial planning to avoid getting into debt again.
Myth 3: Bankruptcy means you can never get credit again
You can get credit. Certain banks offer credit to those just out of bankruptcy. A smart choice is to opt for a secured credit card, where you deposit a certain amount, usually between $200 and $500 that sets your monthly limit. This helps you rebuild your credit. You can also show that you can pay in full and on time with a student or car installment loan.
Myth 4: Filing for bankruptcy hurts your credit for 10 years
Negatives do appear on your credit report for 10 years if you have filed under Chapter 7 or Chapter 11 or if debts could not be discharged under Chapter 13 bankruptcy. But positives also appear on your credit report, including on-time and full payments. Be sure to check your Experian, TransUnion and Equifax credit reports once a year to ensure they accurately reflect your activity. Document and file any disputes to keep your record as clean as possible.
Myth 5: Bankruptcy means creditors harass you even more
Once you file for bankruptcy, an automatic stay goes into effect, protecting you against creditors. They cannot harass you or pursue you, and neither can their collection agencies. They cannot garnish your wages, repossess property or foreclose on your home. Bankruptcy serves as a means to pay them, and they have an opportunity during the 341 meeting of creditors to voice any concerns about payment.
Get a full understanding of how bankruptcy can help you live debt-free
Invictus Law, P.C., with offices in Santa Ana and Ontario, California, helps those burdened with debt file for bankruptcy and get financial relief. Call us anytime at (949) 287-5711 or use our online contact form to schedule your free initial consultation. Our firm does not require you to pay any up-front attorney’s fees.