Bankruptcy is fast becoming a popular solution for many people in the United States who are facing difficult financial times. This is a much more common solution than it was 20 years ago, largely due to the recent downturn of the economy. But if you are thinking about filing for bankruptcy, it’s important to know that this process is clouded by certain myths that distort peoples’ understanding of it significantly.
Common Myths and Truths
In order to fully understand the benefits bankruptcy can offer, in addition to its limitations, it’s necessary to debunk many of the common myths that circulate about bankruptcy, including the following:
MYTH: Bankruptcy will ruin your finances forever.
TRUTH: Actually, though bankruptcy will be viewable on your permanent record for a few years, it is actually more of an opportunity to “start over” with your finances. Once your debts have been cleared, you can establish an economic system that makes more sense for your situation.
MYTH: If I file for bankruptcy, my spouse will also suffer financial ruin.
TRUTH: When individuals file for bankruptcy, their bankruptcy will not affect a spouse. So as long as you don’t file for bankruptcy as a couple, your spouse should not be affected by you filing for bankruptcy.
MYTH: If I file for bankruptcy, I’ll lose everything I own.
TRUTH: Because there are several forms of bankruptcy, some of which do not involve asset liquidation, you may have options for keeping your belongings even through the bankruptcy process.
If you or someone you know is thinking of filing for bankruptcy and you have questions about this process or about how it will affect you and your loved ones, speak with an attorney from Hong Law, PLC, today. By calling us at (319) 632-1400, you can get any questions you have answered or concerns addressed.
Coralville, IA 52241
Phone: (319) 354-1804
Map to our Coralville Office