Bankruptcy Today - Bankruptcy Advice

There are a lot of things people don't know about bankruptcy. Misconceptions are abundant, especially with the new law changes that took affect in 2005. If you're confused about what bankruptcy means – and doesn't mean – then check out a few of the things listed below:

You must be flat broke to file for bankruptcy.

Wrong. The fact is, the only criteria to filing for bankruptcy are an inability to pay your debt as it comes due. Actually, waiting until your mortgage company is ready to foreclose to file for bankruptcy leaves you with fewer options to safeguard your financial future.

If you file for bankruptcy, you'll never be able to get credit again.

Wrong. You can begin rebuilding your credit two years after fulfilling your debt requirements under your bankruptcy agreement. Although it will remain on your credit record for ten years, many people can begin to slowly rebuild their credit rating by paying their rent, mortgage and utilities on time; then applying for a low credit limit store credit card; and finally applying for bankruptcy loan when they are ready.

Once you've gone bankrupt, you can never own a home.

Wrong. Once you begin to rebuild your credit, creditors of all types – including mortgage lenders – will begin to consider lending you money. Your interest rates may be higher, but it is possible to obtain a loan. Sure, it'll take awhile to prove to lenders that you can handle payments again, but it is possible to buy your own home following a bankruptcy.

Taxes cannot be discharged in bankruptcy.

Wrong. Some are such as personal income taxes that are more than three years old.

My student loans aren't dischargeable under the new bankruptcy laws.

This one is generally true, but there are some exceptions. If the debtor can prove certain hardship, student loans may be dischargeable.

If I signed an agreement stating that a debt cannot be discharged in bankruptcy, it is my debt forever.

Wrong. Although there are extremely limited exceptions, these bankruptcy clauses are unenforceable and are a tactic used to scare debtors into not filing bankruptcy.

I can lose my job if I file for bankruptcy.

Wrong. It is illegal to fire someone for filing for bankruptcy. If, however, you apply for a new job after filing for bankruptcy, a potential employer can use the bankruptcy filing as a factor in deciding whether to hire you or not.

Now that you understand some of the misconceptions surrounding bankruptcy, you'll be better prepared to make an informed decision as to what is best for you and your family.

Instructions on How To File Chapter 13


United States Bankruptcy Courts Each of the 94 federal judicial districts handles bankruptcy matters, and in almost all districts, bankruptcy cases are filed in the bankruptcy court...

Our mission is to show you how to stop foreclosure, discharge unsecured debt and discharge IRS tax liens with an emergency chapter 13 bankruptcy.
We believe that if you don't know your rights, you don’t know your options.