subject: Bloated Up Myths About Bankruptcy And Their Concrete Facts [print this page] Bankruptcy as you very well know is a condition where an insolvent person or organization cannot repay the debts owed to the creditors and is imposed by the court order after initiation by the debtors. The term bankruptcy has become so common these days that there are many myths brewing in the dark about the same but it is important to know the reality of myths and also the concrete facts before jumping to any conclusions regarding bankruptcy. The myths regarding bankruptcy are sometimes very misleading for the debtors and should be thoroughly analyzed before making any harsh decisions, so lets have a look at these misconceptions about bankruptcy followed by the facts that should be considered by the debtors.
Myths about bankruptcy and the concrete facts overshadowing them:
1) Since 2005 when reformed bankruptcy laws were first implemented the most common myth is that bankruptcy is very expensive prospect and only the rich can afford. However the truth is that bankruptcy is affordable for debtors having limited resources as some bankruptcy attorneys offer payment plans to help the debtors in such a condition. For doing so the debtor has to file Chapter 13 bankruptcy as the fees can be repaid over the time period of 3-5 years according to the repayment plan.
2) Although after the 2005 bankruptcy reform laws it is difficult to qualify for the Chapter 7 bankruptcy if one has regular income flow, for debtors who are in a real precarious situation can get full discharge of debts under the Chapter 7 bankruptcy.
3) Another common myth is that people who are not married cant file bankruptcy alone without the involvement of their spouse, but this is not true. One cane file bankruptcy alone even if one is married, the only thing that bankruptcy officer will check is that your spouse is not a millionaire and you are not trying to trick the law by filing a false bankruptcy to get out of some unknown condition.
4) Most people think that if bankruptcy is filed then they will lose every damn asset and money at their disposal. But this is far from truth as one can keep their house, apartment or even their car depending on the genre of bankruptcy filed. According to the bankruptcy law one can keep their certain stuff and this works like an invisible shield.
5) Another terrible myth out there is that bankruptcy will destroy the credit and jeopardize any chances of you getting a house or car for 10 years at least. Dont worry this is just a bloated up rumor as you can get your credit score (even above 700 points) in under two years.
6) Some people believe that after taking credit counseling course one needs to wait for 180 days before bankruptcy can be filed. The truth is that it is the other way around as debtor needs to take this course within 180 days of filing bankruptcy and failing to do so will discard any bankruptcy discharge plea. Although one can file bankruptcy even if they have yet to take the course.
