Common Misconceptions About Bankruptcy

Posted by William Kain on January 3, 2017 at 12:00 PM
William Kain

For someone struggling with debt, bankruptcy may be a choice. It can offer the chance to wipe the financial slate clean, to get a new start. But how do you know if it’s right for you and which bankruptcy option do you choose? There is a lot of information out there and not all of it is true. Here are three common misconceptions that our MN Bankruptcy Attorneys often hear and it’s about time that they were cleared up.

The 3 Most Common Misconceptions Our MN Bankruptcy Attorneys Often HEar

  1. Filing bankruptcy means losing property. This is not true and is often an unfounded worry. In most cases, you are able to keep your home, car, and most of your personal property. In fact, chapter 13 bankruptcy allows you to keep your property and set up a repayment plan to take care of your debts without liquidating assets (unlike chapter 7, which involves liquidation of nonexempt property). If you’re worried about what may happen to your property when filing bankruptcy, ask one of our MN Bankruptcy Attorneys.
  2. Filing bankruptcy will impair your credit for a long period of time. While filing bankruptcy is a negative credit event, it actually enhances your ability to improve your credit in the future because it straightens out your income-to-debt ratio, providing you with the opportunity to start fresh. A bankruptcy will be reported on your credit score for ten years but 80%-90% of our clients actually see a higher credit score within one year of filing.
  3. Filing bankruptcy becomes publicized. This is not true. No one needs to know about your bankruptcy except you and your creditors. The only place where it would be published is on the bankruptcy court website, where a person has to pay to find any information on the website and is typically a creditor or attorney. For most people, no one will know.

Need Help? Contact The MN Bankruptcy Attorneys At Kain & Scott, P.A.

Financial burdens are wearying and bankruptcy can be an option. We understand that it can be a difficult time for you and we want to help. Call now or sign up online to schedule a free initial consultation. Our MN Bankruptcy Attorneys will sit down with you and explain the entire process. Let us help you get out from under the burden of debt. 

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Topics: Bankruptcy