If you are considering filing for bankruptcy, there are a lot of resources online that will guide you through the proceedings. However, there is also a lot of misinformation out there, and acting on any of it could compromise your financial security. Below, the seasoned team at LaRowe Gerlach Taggart LLP Attorneys at Law explores some of the most common myths about declaring bankruptcy.
3 Popular Myths Debunked
1. You Will Lose Everything
Although it is true that chapter 7 requires you to liquidate certain assets to pay back your creditors, you will not lose everything if you declare bankruptcy. In general, debtors are allowed to keep nonexempt assets, which are those that are essential for living and working. This might include vehicles up to a certain value, household appliances, public benefits, damages for personal injury claims, and pensions.
2. You Will Destroy Your Credit
If you file for bankruptcy, it can show up on your credit report for seven to 10 years; however, it will not necessarily inhibit you from securing credit. Most people can qualify for credit cards that have a fairly reasonable rate within a few years. You will also be able to get a secured credit card immediately after filing, and you can use it responsibly to repair your credit even faster.
3. You Will Not Be Able to Discharge Your Medical Debt
Although there are certain kinds of debt you cannot discharge by filing bankruptcy, medical debt is not one of them. In fact, according to USATODAY, hefty hospital bills are the number one cause of personal bankruptcy in the United States.
If you need a fresh financial start and you are considering filing for bankruptcy, contact an attorney from LaRowe Gerlach Taggart LLP Attorneys at Law in Reedsburg and Sauk City, WI. They can assess your financial situation and help you determine the best way to proceed. To learn more about all of their practice areas, which include criminal law and divorce, check out their website, and call (608) 524-8231 to get started on the part to financial freedom today.