Chapter 7 and Chapter 13 bankruptcy are designed to help people regain financial freedom. If you file for Chapter 7 bankruptcy, your nonexempt assets will be sold to pay back creditors. And if you choose to file Chapter 13, your future income will be used for paying off debts within 3-5 years. These legal processes are viable debt relief options for a lot of people; however, don’t want to file because of the myths surrounding the bankruptcy process. That is why it is important to consult with a Charleston, WV bankruptcy attorney to get the facts about bankruptcy and learn about one’s bankruptcy options. These myths include the following:
Bankruptcy Filing Is Only for Those Who Don’t Manage their Finances Responsibly
Anyone in Charleston can experience financial issues and often people file bankruptcy after a challenging life event that impacts their finances. For example, people who go through a divorce and need to run their household on a single income instead of two may be dealing with significant debt.
A Person Will Lose Everything They Have When They File
There are many exemptions built into bankruptcy law. Because of this, a lot of people who file for bankruptcy protection don’t lose any property at all. Filers who have nonexempt property can often keep their property as long as they agree to pay back some or all of their debt.
The Bankruptcy Process Can Discharge All Debts
It is important to keep in mind that not all kinds of debts can be discharged during the bankruptcy process. These debts include domestic support obligations such as child support and restitution owed due to a crime committed.
Filing for Bankruptcy Will Cause Permanent Damage to One’s Credit Score
Charleston bankruptcy can affect a person’s credit score; however, a lot of those who filed have been able to rebuild their credit after the process. The best approach to take is to get a secured credit card and use it for making regular, on-time payments right after filing for bankruptcy. With this option, you will have paid the credit card company a sum of money that stands for your credit line. Should you charge on that account and not pay, the credit card issuer will take the funds it’s holding to pay that debt.
Some creditors have reached out to people who have filed for bankruptcy. The reason is that these people’s debts have been taken care of. Without debts, they can become great users of credit.
