When people hear the word “bankruptcy,” the instant reaction is likely a negative picture of a person gone broke after reckless spending. This type of reaction is the result of a lot of misinformation that exists about bankruptcy and the people who file for it. At Mara & Mara, Attorneys at Law, we believe it is important to educate people about bankruptcy so that they can determine if it is a viable option for them. Our attorneys are well versed in bankruptcy law, and recently compiled a list of bankruptcy myths that you may be familiar with.
According to our lawyers, common bankruptcy myths include the following:
MYTH: People who file for bankruptcy are fiscally irresponsible.
FACT: People who file for bankruptcy come from all walks of life and likely had a variety of contributing factors that led to their decision to file. Long-term unemployment or underemployment, medical care costs, costs associated with running multiple households after a divorce and many other factors all weigh people down with significant financial burdens.
MYTH: Bankruptcy can clear up any debts.
FACT: Unfortunately, there are several kinds of debts that bankruptcy cannot discharge. Spousal and child support are categorized as domestic support obligations, meaning that the person filing for bankruptcy remains responsible for those debts. Bankruptcy also does not clear up student loans and certain types of tax debts. An attorney can help you determine which of your debts can vanish under bankruptcy.
MYTH: Bankruptcy destroys your credit beyond repair.
FACT: Many people successfully rebuild their credit after filing for bankruptcy and eventually purchase new homes or cars and take out new credit cards. You simply must remain disciplined and patient after filing, and follow the tips that an attorney gives you.
MYTH: All people who file for bankruptcy lose their homes and possessions.
FACT: While some people may lose their assets, a skilled lawyer can help you to hold on to all of them. It depends on your personal financial situation and the type of bankruptcy for which you file.
If you still have any reservations about the bankruptcy process, call Mara & Mara, Attorneys at Law today at 386.310.2685 or contact us online with your questions. Our Ormond Beach attorneys are happy to keep you informed about the bankruptcy process. Contact us at any time — we’ll answer quickly and do our best to provide you with personal, professional service that grants you a fresh financial start.