Things That Just Aren't True About Bankruptcy
When you're in financial trouble, other people have all kinds of advice. Some of the things they tell you are true. But some of the things they say are just plain false — they're bankruptcy myths.
Believing bankruptcy myths can do more than keep you from getting rid of the debt that's weighing you down. It can have a harmful affect on your credit, your future and your family. That's why you should only get your bankruptcy advice from a well-qualified lawyer.
At Skrupa Law Office, LLC, in Omaha and Lincoln, we can help. Our attorney — Frank Skrupa — is one of only a small number of nationally board certified bankruptcy specialists. Bankruptcy is all he does, and he does it extremely well.
MYTH #1: Filing for Bankruptcy Costs Too Much Money. How Can I Afford to Hire an Attorney?
Many bankruptcies that we file on behalf of our clients can be handled for a small fee upfront. Often, this small fee translates into thousands of dollars of savings and significantly reducing or eliminating your debt. Depending on your situation, we also offer payment plans — so you don't have to delay your fresh financial start.
MYTH #2: The new bankruptcy laws make it almost impossible to file bankruptcy.
In 2005, Congress passed changes to the bankruptcy code. Many people believe that the changes make it nearly impossible to file bankruptcy, but this is simply not true. The changes to the code are not preventing people from filing bankruptcy at all. In fact, national level of bankruptcy filings are almost what they were before the new law went into effect.
MYTH #3: If I file bankruptcy, I will be forced to give up the possessions I need.
There are all sorts of stories out there about people who filed for bankruptcy and lost their possessions, but the truth is that most people who file bankruptcy do not have to give up anything at all. The law protects "normal" household goods and items, tools of the trade and most personal effects. These can normally be exempted, but talking with your lawyer is the only way to know for sure.
MYTH #4: If I don't list everything at the time I file for bankruptcy, I can't add it later.
Many people who need to file for bankruptcy are overwhelmed by piles of bills. They don't know exactly how much they owe and often feel like it's nearly impossible to figure out the true amount due to creditors. They put off getting the help they need because they worry that any bills not listed at the time of filing can never be discharged through bankruptcy.
This is not true. The law lets people (with the help of their lawyers) amend the documents they file, so any bills that may be forgotten can be added. As experienced attorneys, we have the skills necessary to put your finances in order. We are very thorough and complete, but we also know that putting off getting the help you need isn't necessary.
MYTH #5: Bankruptcy will destroy my credit.
By the time most people realize that bankruptcy is the right choice for them, their financial problems have already led to a low credit score. However, they still worry that filing bankruptcy will destroy their credit. The truth is that credit can be rebuilt after bankruptcy, and a bankruptcy filing only stays on your credit record for a set period of time.
39 More Bankruptcy Myths
Dear Reader, you hear lots of stuff out there......well meaning friends, co-workers, relatives, even a lot of stuff on the internet.......a lot of what you hear is false! Consider the following!
MYTH #1. All the good Bankruptcy laws have been repealed by Congress.
MYTH#2. If you did not file for bankruptcy before October 17, 2005, then you are no longer allowed to file.
MYTH #3. You cannot discharge any credit card debts under the new Bankruptcy laws.
MYTH #4. You can only keep one car or one truck if you file for bankruptcy.
MYTH#5. You will have to give up all of your vehicles if your file for bankruptcy.
MYTH #6. The IRS will audit all of your prior tax returns if you file for bankruptcy.
MYTH #7. You will have to file amended tax returns for the past 4 years if you file for bankruptcy.
MYTH #8. You can only have one TV and one VCR if you file for bankruptcy and if you have a DVD it will be taken by the Trustee.
MYTH #9. The Bankruptcy Court will take all of your property if you file.
MYTH #10. You can no longer stop a foreclosure by filing for bankruptcy.
MYTH #11. If you file for bankruptcy, all of your bank records and tax records will be audited.
MYTH #12. An FBI agent will come to the home of every debtor and will take photographs of everything.
MYTH #13. Before you can file for bankruptcy, you must pass a written test. Likewise, you must pass another test to get out of bankruptcy.
MYTH #14. Before you can complete your bankruptcy case, you must pass a lie detector test.
MYTH #15. After you file for bankruptcy, you will never be entitled to another tax refund.
MYTH #16. If you have any money in a bank account and file for bankruptcy, then all of your money will be taken by the bankruptcy trustee.
MYTH#17. If you file for bankruptcy, you will never be able to get any new credit for anything.
MYTH#18. You can never own a home if you have filed for bankruptcy.
MYTH#19. You do not have to list all of your debts if you file for bankruptcy. In short, you can pick and choose the debts to be included in your bankruptcy case.
MYTH #20. If your former spouse files for bankruptcy on a joint debt, his or her bankruptcy will discharge your obligations on that same joint debt.
MYTH#21. You do not have to list all of the property you own if you file for bankruptcy. You can pick and choose what is in and what is out.
MYTH#22. If property is owned in your name, and the bill is in your name, then you do not have to list the debt or the property if a relative or a friend actually has the property and is making the payments.
MYTH #23. The legal fees for filing a bankruptcy are so high that only the very rich can afford to file.
MYTH #24. You can eliminate and discharge all of your back child support by filing for bankruptcy.
MYTH #25. If you are currently paying alimony or spousal support, all obligations to pay will be terminated forever by filing for bankruptcy.
MYTH #26. You don't need a lawyer to file for bankruptcy. All it involves is filling out a bunch of forms.
MYTH #27. You should max-out all of your credit cards just before you file for bankruptcy.
MYTH #28. If you give any property to a relative before you file for bankruptcy, they will be able to keep it.
MYTH #29. If you file for bankruptcy, you cannot discharge any income tax debt regardless of the age of the tax claims.
MYTH #30. You must give up your home if your file for bankruptcy.
MYTH #31. You will never be able to rent an apartment or a home if you file for bankruptcy.
MYTH #32. Everyone will know I've filed for bankruptcy.
MYTH #33. All debts are wiped out in a Chapter 7 bankruptcy.
MYTH #34. If you're married, both spouses have to file for bankruptcy.
MYTH #35. It's really hard to file for bankruptcy.
MYTH #36. Only deadbeats file for bankruptcy.
MYTH #37. I don't want to include certain creditors in my filing because it's important to me to pay them back someday and if the debt is discharged, I can't ever repay them.
MYTH #39. You can only file for bankruptcy once.
Call Us Today for an Appointment
Bankruptcy may be an option for you. To find out more, talk with an attorney at Skrupa Law Office, LLC. Contact us by calling our Omaha law office at (402) 571-2900 or our Lincoln law office at (402) 464-3311.