Five Bankruptcy Myths you Won’t Actually Deal With


Many people are overloaded with debt and bills in this economy. Some of these people could benefit from filing for bankruptcy. This can be a tough decision to make, especially if you are trying to figure it all out on your own. While researching, unfortunately people find many myths about the process that keep people from getting the financial relief that they need in their life. Here are some of those myths and the truth about the process:

You will have to sell all of your personal assets

There are many items that are protected in a bankruptcy such as the assets needed to earn a living as well as basic items needed in your daily life. A bankruptcy trustee can explain what you will be allowed to keep. You may lose your home and other items that you find of great importance, but you won’t necessarily lose everything. Before making a decision talk to an advisor to find out what is an isn’t protected.

You will lose your retirement

Most, if not all, of your retirement money is protected from liquidation in a bankruptcy. Creditors may tell you differently, but this is the reason you need a bankruptcy trustee. They will be working in your interest and will defend your rights. Never liquidate your retirement funds in a rash decision. Find out your options first. You don’t want your current troubles to affect your well being later on in life when you need it the most.

You will have to justify your bankruptcy

You do not have to justify anything. According to a professional from Mclay, if you qualify for a bankruptcy, it is a matter of procedure and following the law. This is why it is important to consult with a bankruptcy trustee in London, Ontario before you let creditors or others tell you things that aren’t true. A professional can explain the entire process to you in a way that you can understand, and they are always working in your interest. Bankruptcy may or may not be right for you, but a bankruptcy trustee knows all of the laws pertaining to your financial situation.

You will never get credit again

This is simply false. Although you will not be able to get an unsecured credit card right away, you will be surprised at how quickly it becomes possible. This is because a person filing for bankruptcy cannot file again for several years, and creditors know that they have a good chance of collecting on the debt. In time, you may even be able to get a mortgage for a new home. It will take time to recover, but it will not follow you for the rest of your life.

People will think of you as being irresponsible

Although it is true that there will always be a few people who may look at you as being irresponsible with your personal finances, people today are more sophisticated with money matters. Most people understand the wide range of reasons a person chooses to file for bankruptcy. Sometimes there is just not other option for getting back on your feet and it’s not necessarily a result of poor financial choices.

Whatever your situation is, you need to set your fears aside and consult with a bankruptcy trustee. Your beliefs about bankruptcy may be mistaken, but regardless of what you or anyone else thinks, it is the law that is relevant. A bankruptcy trustee can analyze your financial situation and provide you with the information you need as well as advice on how to proceed. Once you decide to consider bankruptcy, it’s important to meet with a professional and get the information you need right away. You never want to wait till you are hounded with calls from creditors and become confused of what to do.

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