Bankruptcy Myths and Truths

Bankruptcy Myths and Truths

At The Ballard Law Group, our goal is to help put you — not your creditors — in charge of your future. But we cannot do this if you never come to us with your debt issues and allow us to begin helping you. Unfortunately, many people who could benefit greatly from filing for bankruptcy choose not to explore the option as a result of misinformation and common myths about bankruptcy.

Is bankruptcy right for you? Call us at 206-782-2111 for a free initial consultation.

Bankruptcy Myths and Truths

The truth about bankruptcy is that for many people it is the best way to get a fresh start and stop creditor harassment. But this has not stopped skeptics and others from peddling misinformation about bankruptcy.

The following are among the most common bankruptcy myths:

  • You will lose your house if you file Chapter 7 bankruptcy: It is extremely rare that a person loses his or her home in a Chapter 7 bankruptcy.
  • You will lose your car if you file Chapter 7 bankruptcy: Much like homes, it is extremely rare that a person will lose his or her primary vehicle in a Chapter 7 bankruptcy.
  • You will lose your pension or 401(k): If your retirement plan is an ERISA-qualified plan it will not be at risk during a Chapter 7 bankruptcy.
  • Your credit will be ruined by filing for bankruptcy: In most cases, a person’s credit is improved in the long run as a result of bankruptcy; if you are considering bankruptcy your credit is already likely severely damaged already.
  • You will have to wait a decade or longer to obtain loans: In many cases, people begin receiving solicitations for credit cards and other sources of credit almost immediately after a discharge; as time goes on, the interest rates of your loan offers will improve.

You cannot file for bankruptcy if you make too much money: Eligibility for Chapter 7 is about more than just the means test; depending on the source of your debts we still may be able to place you into Chapter 7. However, if you are unable to file Chapter 7, you will likely be eligible for Chapter 13.

Contact Our Ballard Bankruptcy Law Attorneys

From your free initial consultation to the start of your life after bankruptcy, we will guide you through each step of the bankruptcy process. Contact us to discuss your options with a lawyer.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.

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