Myth associated with filing bankruptcy

Financial loss and economic crisis is one of the major reasons for the increase in the rate of filing bankruptcy. Due to lack of correct information many people are harboring wrong notion regarding the after effect of filing bankruptcy. If you want to quench your thirst regarding your queries then this article can help you get a proper knowledge on filing bankruptcy.

Do not need to be a broke:
In order to file for bankruptcy you do not have to be a broke. But remember if you are financially well off then there is no need to file for bankruptcy. You might think that only an insolvent is capable of filing for bankruptcy. The bankruptcy code is not dependent upon you being penniless, homeless. But bankruptcy does not mean that you would lose your job or have to surrender your home or court would take possession of your home

Bankruptcy declaration might not disrobe you in public:
You might think that filing bankruptcy can strip off your reputation in public. But if you are not a celebrity then people would be hardly interested to read about a common man going bankrupt. If the bankruptcy papers are not sent to your work place then it won’t be that difficult to hide the filing from your employer.

You might not have to lose all your property:
There are numerous misconception associated with the after effect of filing for bankruptcy. You might not have to lose your right to ownership if you think of filing bankruptcy to remove your complete or fractional amount of debt. The state law also plays a key role on protecting your portion of property. The federal exemption law can be used as a protective measure to a certain value of the property. Under Chapter 7 Bankruptcy you are liable to keep all your assets. If you make the payment on right time for the assets like car and home then you can easily keep them.

Filing bankruptcy can’t stop you from buying a house:
If you have enough security deposit to give the lender then he won’t mind lending you money. The only criteria a money lender has is the security deposit against the cash and they charge high interest on the loaned amount. The bank can reconsider to grant a loan even after filing for bankruptcy if you make a sufficient amount of down payment.

Do not think that bankruptcy can stop you from getting credit:
Bankruptcy can never stop you from getting credit as there recent filers are on the target of the money lenders. You might have to pay comparatively high interest rate on the loaned amount. The interest rate won't be high if you can wait for two year after filing bankruptcy before applying for another loan.

More than half of your debt would be discharged:
The debts that you have burdened yourself with would decide whether all your debt would be discharged or not. There are low chances for debt like students loan, recent taxes, child support might not be eliminated. Discuss the nature of the debt that you have incurred with your bankruptcy lawyer so that he can suggest you some other alternatives.

So these are few myth that people tend to harbor but this article would have helped to throw some light to clear your misconception about filing for bankruptcy.
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