Do you know what bankruptcy is? If you do not, then you should be informed that personal bankruptcy is a situation that is often caused by abrupt changes in the financial situation of an individual because of medical emergencies, divorce, unemployment, or debt. Filing for bankruptcy must be thought over as a responsible step towards obtaining financial freedom. If you are thinking about filing for bankruptcy, then some of the facts and myths about it have been given below to help you get a better idea.
Myth 1: You Can’t File for a Personal Bankruptcy
The amendments made by the US Congress in the year 2005 makes it possible for any debtor to file for a bankruptcy. The bankruptcy is governed by different state laws. If you are filing for a bankruptcy, then the bankruptcy lawyers will help you determine which level you qualify for.
Myth 2: It Is Embarrassing
If you do not get a personal bankruptcy filed, you will have to face more embarrassing situations when you are hounded by the creditors. If you take responsibility of your financial state and pay up to your liabilities, then it is an admirable task rather than being something to be ashamed of.
Myth 3: Bad Credit Score
The completion of the proceedings of personal bankruptcy will help clear your credit record which will permit you to start with a clean and brand new slate. A number of bankruptcy lawyers guarantee the fact that filing bankruptcy does not mean that you will have to roam around with a bad credit score for the rest of your life.
Myth 4: Can Only File Once In a Lifetime
If you file for a Chapter 7 bankruptcy, then you will have to wait a few years before you file for another personal bankruptcy. However, you have the ability to file for a Chapter 13 personal bankruptcy as many times as you want.
Myth 5: You Will Lose Everything You Have
Bankruptcy has been designed to protect the debtors from losing all their assets while helping them find a way to settle the debts. You can hire a bankruptcy lawyer to provide you with the proper information so that you do not end up losing your belongings.
Personal bankruptcy is a very serious but a highly effective way to solve your financial issues. However, before you file for a personal bankruptcy, you should make sure that you have taken a look at all the bankruptcy alternatives available for you.