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Everyone Should Know the Truth Behind These Common Bankruptcy Myths

You should certainly take the time to consider all of your alternatives for regaining control of your finances if you are battling with mounting debts. Bankruptcy is included here. Due to erroneous information about what bankruptcy is and does, people all too frequently are unwilling to consider it.

Contacting a bankruptcy lawyer is the best approach to learn the truth about your bankruptcy choices, but in the interim, let’s start by busting these top ten bankruptcy myths. Then contact The Law Offices of Paul Y. Lee at 951-755-1000 for a legal consultation.

Filing for bankruptcy will harm your credit

It’s likely that your credit is already quite bad by the time your bills become so bad that you’re thinking of declaring bankruptcy. Contrary to what you might believe, bankruptcy can really lay a solid foundation for quickly repairing your damaged credit.

Immoral people file for bankruptcy

Taking use of a legal option that will give you debt relief is not immoral, even if you should strive to faithfully repay all of your bills.

Before submitting, you ought to pay off your car loan

In reality, you can typically keep your car during a bankruptcy case, and the bank lien on it will prevent the bankruptcy trustee from taking it.

You ought to exhaust all of your retirement funds first

Savings for retirement are immune from bankruptcy if they are held in the appropriate types of retirement accounts. These accounts shouldn’t be emptied before filing for bankruptcy.

Pay off some of your debts completely before filing

Sometimes people borrow money from friends or family and want to make sure they are reimbursed before filing for bankruptcy. The bankruptcy trustee may take the money back from those lenders and divide it as they see proper if you don’t pay off such debts at least a year in advance.

Placing assets in another person’s name allows you to conceal them

Once more, the assets may be seized if the bankruptcy trustee discovers that you have done this. Additionally, they might be able to persuade the court to reject your request for a discharge on the grounds that you lied about your assets.

Filing for bankruptcy won’t shield you from creditors

Actually, if you hire a bankruptcy lawyer, your creditors will be compelled to stop contacting you and instead get in touch with your lawyer. Additionally, a large portion of the unsecured debts that the creditors are worried about will probably be dismissed in your bankruptcy.

There is a 7-year waiting period between filings

In reality, the amount of time you must wait between filings varies, but it should never exceed 7 years.

Consolidating debt is preferable to bankruptcy

Debt consolidation frequently fails to significantly lessen a consumer’s debt load. Due to the fact that numerous debts are totally eliminated during the bankruptcy process, it offers better and quicker relief.

Bankruptcy should be a final option

Don’t put off thinking about bankruptcy until you’ve squandered all of your money. Making a filing as soon as you notice you are in difficulties can improve your situation significantly over time.

Call The Law Offices of Paul Y. Lee at 951-755-1000 now to learn more about bankruptcy and request your consultation.