People will hear all sorts of things about bankruptcy that simply aren’t true. Call the Bhend Law Office to discuss any questions you have.
Here are a few of the common misconceptions I run into frequently.
Bankruptcy will hurt your credit score
People can immediately begin to repair their credit after they receive a discharge of their debts. Debts that you reaffirm (such as a house or a vehicle that you agree to continue to pay after your discharge) will reflect as a positive on your credit report. Additionally, people can apply for credit after they receive a discharge. It is possible to improve your credit score by as many as 100 points within a year of filing bankruptcy.
You lose your personal property
In most cases, bankruptcy will allow you to retain all your personal possessions. Bankruptcies are designed to protect your personal property from creditors. Bankruptcy will not wipe out all liens. You will need to continue to pay on debts where your possessions you wish to retain that are subject to a lien (common examples are a house or a vehicle)
Everyone will know
Although bankruptcy is public record, it is unlikely that people will know of your filing. Print media rarely report bankruptcy filings (this was not always the case).
I can choose which debts to disclose
You must disclose all your assets and your debts when you file a bankruptcy, even the debts you wish to keep. All creditors are treated equally to prevent discrimination. This disclosure is mandatory.
Bankruptcy will not affect my tax debt
Generally, income taxes three years older or more can be discharged in bankruptcy if certain criteria are met.