The Misconceptions Surrounding Chapter 7 Bankruptcy

You might be surprised to see that some of the things you think are true are nothing more than fiction. Do not worry, it is better to be informed about these things than to be uninformed — even if you want to believe a lie and are all too willing to share it to the world! But something you should consider is that those sentiments are misleading and usually create an aura of fear that has the capability of crippling its victims. Yes, it is as terrifying as it sounds — if it sounds scary to you. So, ignorance is not bliss after all, especially as used in this context. So, are you interested to know the truth that will give you that debt relief that you want? If your answer is yes, which it should be, here are three myths about Chapter 7 bankruptcy you deserve to know about:

Your credit will never recover!

Do you see how scary it is to think that this is true? It could easily put somebody off who could live a debt-free life and be better for it especially in the long run. Here is the truth: if you file a Chapter 7 bankruptcy, it will only linger for seven years. It will not be in your credit report after that time. Does that mean you are free? Yes, that is what it means. And you should know that this is not limited to Chapter 7. It is applicable to all types of bankruptcies. This will no longer stop you from filing it again. It is liberating to know that. And if you are concerned or worried that you won’t be able to get a loan, don’t be. You should take this as a fact because it is a fact: alternate lenders and credit card companies are more than willing to work with you. Remember, you are financially responsible now. See? There is no cause for alarm.

You are going to lose your car or home.

This is a very common myth that has kept many people from filing a Chapter 7 bankruptcy for years. There is no need to write a thousand words about it before it is discredited as a lie, because there is nothing complicated about it. However, you would want to know why that is. There are new bankruptcy laws that will allow you to keep your house and, potentially, your car too, if it is worth a certain amount. You might be thinking: what is the catch? There is none! If the price of your house is significant, you might want to look at others so that you could keep more assets.

Your retirement fund is gone if you file for it.

It is also wrong to generalize it. Most retirement savings are not being touched such as 401(k) plan.