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    Myths & Facts

    There’s a lot of misinformation about bankruptcy, and it’s important for you to know the facts so you can determine whether a Chapter 13 filing is best for your particular circumstances:

    • Myth: It’s embarrassing to file for personal bankruptcy.

      Fact: Filing for bankruptcy can reduce stress and trauma in your life, and is less upsetting than having creditors call you and even your family members demanding payment. Filing for bankruptcy allows you to “start over,” and you should view it as an opportunity to take over managing your personal affairs.

    • Myth: Your credit score will always be bad.

      Fact: Although record of a personal bankruptcy appears on your credit report, when the bankruptcy is completed and discharged by a bankruptcy court, your previous debt is shown as “included in bankruptcy” and therefore it demonstrates that debt is no longer owed.

      Credit worthiness can be rebuilt after bankruptcy by paying bills on time & managing credit wisely. Each debtor is required to take a Financial Management course that makes this easier to do.

    • Myth: A person may file for bankruptcy only once.

      Fact: That’s partially true, as you may not file for Chapter 7 bankruptcy for at least 8 years after being discharged.

    • Myth: Filing for personal bankruptcy means you lose everything.

      Fact: Regardless of whether you file for personal bankruptcy under Chapter 7 or Chapter 13, you are allowed to keep various assets, usually your home, car and most, if not all, of your personal possessions. Retirement accounts are protected from yur creditors by the Bankruptcy Code. An experienced bankruptcy attorney can help you determine what those assets are and maximize property you retain.