Many myths exist about bankruptcy which could stand in your way of ultimately choosing to file, even if it is the best solution for your current financial situation. In addition, the same myths could lead a person to file under false pretenses of what the process has to offer, leaving them in a more serious financial situation than when they began. Therefore, it is again stressed that the entire process of filing for bankruptcy, and all that goes along with it, be fully understood by those contemplating the option before a final decision is made.
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There are many myths circulating the U.S. nation that would likely prevent a person from being compelled to file for bankruptcy. One of these is the false belief that filing could cost you your job. On a technical level this is absolutely untrue. Bankruptcy code specifically prohibits blatant discrimination against anyone who has been or is currently suffering from debt, and this includes those individuals undergoing the process of bankruptcy. It is also false to believe that declaring oneself bankrupt will prevent you from being able to obtain new credit or purchase a home once the process is completed. Most often, creditors and lenders are less apt to look at a consumer's past credit history and more primed to look at their current credit score. Therefore, a previous bankruptcy filing will not necessarily negatively affect a person's ability to purchase a home. When false misconceptions such as those described above are spouted off to others suffering from debt, it is not unreasonable to see why consumers would shy away from the idea of filing for bankruptcy. However, when demystified, it can easily be seen that there is little to fear in the ways of home ownership and employment status when it comes to possibly filing for bankruptcy anywhere in the U.S.
Other myths about bankruptcy exist, although these act differently in the ways they affect consumer usage. Rather than deter some from filing, certain falsities have actually convinced unknowing people that filing would better serve their situation than anything else. Unfortunately, this notion is sometimes made under false pretenses, and therefore consumers should be aware of the truth before ultimately deciding to file. Some people have been made to wrongly believe that declaring themselves bankrupt will allow them a fresh start with their credit. However, this is not always the case. In fact, bankruptcy can actually negatively affect your credit report and it will most certainly impact your credit score. Higher interest rates will likely be felt by those who declare themselves bankrupt as a result of the effect it will have on their credit score. Others are told that they can file for bankruptcy as many times as they like and that their personal belongings of high expense will not be taken even if their loans are not paid. These statements are both untrue. There are specific time limitations that prevent consumers from filing multiple times within a certain amount of time. Furthermore, expensive personal assets such as cars cannot be kept unless the loans on these items are sufficiently paid.
When individuals are falsely informed about the ins and outs of bankruptcy law and how it will affect their future lives it can greatly alter the decisions they make about filing. In the end, declaring bankruptcy will not be right for everyone, but it is a great means to an end for some. Therefore, it is important that everyone be kept fully informed of the pluses and minuses of filing and what can come from acting on either end of the spectrum. Not opting to declare oneself as bankrupt because false statements have led you to fear the process can be equally as detrimental as declaring oneself bankrupt under false pretenses as to what the process can and cannot do for you. That being said, if you are in debt and contemplating your options the best way to proceed is to align yourself with a professional bankruptcy lawyer that can help you understand the procedure fully and debunk any further myths that may be clouding your decision.
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