If you are struggling with debt, you may consider filing bankruptcy. However, you may hesitate to move forward with this process because of some of the things you have heard about bankruptcy law. To help you feel more confident filing, we have gone over some of the most common myths we hear about bankruptcy law down below.
Myth #1: Only the financially irresponsible file for bankruptcy.
Financial problems can happen to anyone, even those who are careful with their finances. Job loss, serious medical conditions, divorce, and other difficult life situations out of one’s control can warrant the need to file for bankruptcy.
Myth #2: Your credit will never recover.
Your credit score may fall when you file for bankruptcy, but it may already be pretty low anyway. And while it may take some time to rebuild your credit, bankruptcy can be part of the solution. Your debts will be discharged so you will flip your debt-to-income ratio in a positive way with filing bankruptcy. You can also slowly build up your credit score one small purchase at a time, and for most people, within 1-2 years of bankruptcy, they are in a much better place and have made a wonderful credit recovery.
Myth #3: Bankruptcy eliminates all debts.
Although bankruptcy does discharge many types of debts, it does not get rid of all of them. Back taxes, child support payments, restitution, and student loans are much harder to get discharged than credit card or medical bills, for example.
If you have questions about bankruptcy law and if you should consider filing, we are always here to provide further information. Contact us at The Sexton Law Firm today to set up a consultation.