There are many myths out there about bankruptcy prevent people from filing. In reality, bankruptcy is an appropriate option for millions of Americans who are struggling financially and one that could literally eliminate all of their debts in a matter of months. You should never be afraid to at least talk to a lawyer about bankruptcy, how it works, and how it could potentially help you. Here three of the most pervasive myths about bankruptcy that often keep people from making a decision that could get them a fresh financial start. To speak to a bankruptcy lawyer in St. Louis, call the Law Offices of Kenneth P. Carp today or send us an email through our online contact form.
Myth: You Will Have to Give Up Everything You Own
Often, people who are considering bankruptcy mistakenly believe that they will need to give up everything they own in order to reduce or eliminate their debts. This misconception is understandable, as the very idea behind a Chapter 7 bankruptcy (the most commonly filed bankruptcy) is the liquidation of a debtor’s assets in order to pay off creditors. In reality, however, there are exemptions available for virtually every asset class, which means that you’ll be able to keep at least some of your property—and probably the assets that are most important to you. In addition, while each case is different, you should keep in mind that most Chapter 7 bankruptcies are “zero-asset” bankruptcies, meaning that the people who file have no non-exempt assets to liquidate.
Myth: Your Credit Will Be Ruined Forever
While bankruptcy is a derogatory mark on your credit report, many people are surprised to learn that many lenders are willing to extend people credit just a few months after they filed—albeit at a higher interest rate than for people who have not filed for bankruptcy. This is because lenders know that people who have just filed for bankruptcy are financially better off than they were and are likely interested in rebuilding their credit immediately.
Myth: You Will Never Be Able to Buy a House or a Car
The idea that filing for bankruptcy will prevent you from ever buying a house or a car is simply wrong. It is true that a bankruptcy will stay on your credit report for up to 10 years, but it is only one factor that lenders look at when deciding whether to lend someone money. They also look at a person’s income and recent credit history, so if you are employed and have established credit after your bankruptcy, you will likely be able to obtain financing for large purchases—particularly secured purchases like real estate and motor vehicles.
Call the Law Offices of Kenneth P. Carp Today to Schedule a Free Consultation with a St. Louis & St. Charles Bankruptcy Attorney
If you’re having trouble paying your bills each month and are getting deeper and deeper into debt, you should speak to an experienced attorney as soon as you can. Kenneth P. Carp will review your financial situation at no cost to you and let you know whether he believes you could benefit from filing for bankruptcy. To schedule your free case evaluation with Mr. Carp, call our office today (636) 947-3600 or contact us online.