In your quest to improve your financial health, you may have done a lot of research into filing for bankruptcy. Do you know whether everything you have read is true?
Money.com breaks down common myths surrounding bankruptcy. Getting the most out of filing and all the time dedicated to educating yourself hinges on whether you have learned more fact than fiction.
Not everything qualifies for bankruptcy
Financial fraud, recent taxes, child support and student loan debt are examples of items that do not qualify for bankruptcy discharge. Common items that you can discharge when you file for bankruptcy include credit card debt, medical bills and personal loans.
You will not lose everything that you have
Your biggest concern regarding bankruptcy may be about losing your car or house. Depending on the type of bankruptcy you file for, such as Chapter 11 or Chapter 7, you may be able to keep your car, house and other possessions. Anything considered extravagant or unnecessary, such as an expensive car or jewelry, may go toward paying off your debts.
Trying to pay off your debt may not be worth it
With your anxieties surrounding bankruptcy, you may feel it is better that you take care of your debts on your own. While noble, choosing to forgo bankruptcy could result in more frustration for you in the years to come. By filing for bankruptcy, you can put a stop to harassing phone calls from debt collectors and the stress that comes from enduring heaving mountains of debt.
Double-check any information that you read about bankruptcy. You do not want to cheat yourself out of what could be a great opportunity for your financial health.