16 Bankruptcy Secrets Your Creditors Don't Want You to Know

The 16 Bankruptcy Secrets Your Creditors Don't Want You To Know

There are a lot of "Myths" (lies) out there surrounding the concept of bankruptcy. Most of these criticisms are just NOT TRUE and are designed to scare people from getting help by getting rid of their debt. Bankruptcy can solve your debt problems and get you and your family a fresh start.

Bankruptcy Myth 1: Bankruptcy Doesn't Really Get Rid Of Debt.  Sooner Or Later, You Still Have To Pay It All Back. Right?


Totally NOT TRUE. The truth is this: Bankruptcy lets you get rid of certain debts without paying for them...without EVER having to pay for them.   When bankruptcy gets rid of debts...those debts are gone...FOREVER.  Getting rid of certain debts without you having to pay them back is simply how bankruptcy works, 

Bankruptcy Myth 2: Everyone Will Know You Have Filed For Bankruptcy.


Unless you're famous, chances are very good that the only people who will know about a filing are your creditors and the people you tell. While it's true that your bankruptcy is a matter of public record, unless someone is specifically trying to track down information on you, there is almost no chance that anyone will even know you filed. 

Bankruptcy Myth 3: You Will Lose Everything You Have.


Most chapter 7 filers don't lose anything. 

Bankruptcy Myth 4: You Will Never Be Able To Own Anything Again.


This is completely false. There are no laws prohibiting you from buying homes, cars, trucks, equipment, household goods, etc. Once you get what is called your ‘discharge in bankruptcy’. I have many clients who, within 2 years after their bankruptcy case closes, have new cars, have bought houses, and have excellent credit.

Bankruptcy Myth 5: You Will Never Get Credit Again.


FILING BANKRUPTCY MAY BE THE BEST THING THAT EVER HAPPENS TO YOUR CREDIT.   Filing bankruptcy gets rid of debts you can't afford.

Want a Credit Score as high as 720 or even higher?  Start with a bankruptcy.  Besides, having less debt to pay after a bankruptcy makes you look more attractive to banks, credit card companies and other lenders.  In my experience, unfortunately, it won't be long before you're getting credit card offers again.  

Bankruptcy Myth 6: Filing Bankruptcy Means You're a Bad Person.


Filing bankruptcy means you’re a good person, acting responsibly. Everyone wants to pay their bills.  Everyone.  And everyone wants to take care of their family and provide their family with all the things they need.  

Bankruptcy Myth 7: Filing Bankruptcy Will Hurt Your Credit For 10 Years.


You are getting 2 completely different concepts confused with each other. You are getting the fact that bankruptcy is reported on your credit report for up to 10 years mixed up with the effect that reporting will have on your credit.  Just because something is reported on your credit report does NOT mean it will have a negative effect on your credit standing. I put all of my clients into an online course - at no cost to you - to teach you a simple, ethical, FAST way to rebuild your credit score.

Bankruptcy Myth 8: If You're Married... Both You and Your Spouse Have To File For Bankruptcy.


I constantly file cases, where a husband, or a wife, but not both, file bankruptcy. In many cases, where husband and wife both have a lot of debt, it makes sense and saves money for them to both file, but it is never a ‘requirement’ under the law. However, in many situations, there is no good reason at all for the second spouse to file.  In these situations, I just file the spouse who needs the help, and leave the other spouse completely out of it. 

Bankruptcy Myth 9: It's Really Hard To File For Bankruptcy.


Not when you file with an EXPERIENCED bankruptcy attorney. 

Bankrupcy Myth 10: I'm a Bad Person if I File for Bankruptcy.


You need to get over blaming yourself. Most of the people who file bankruptcy are good, honest, hard-working people, just like you and me, who file as a last resort after months or years of struggling to pay the bills.  You’re completely wrong in thinking that you’re a deadbeat if you file bankruptcy.  Filing bankruptcy is actually one of the most positive, responsible, honorable and noble steps you can take on behalf of your family and your family’s future, happiness and prosperity. 

Bankruptcy Myth 11: Even If You File For Bankruptcy, Creditors Will Still Harass You and Your Family.


The minute you file bankruptcy, the Bankruptcy Court issues an Federal Court order telling all of your creditors to leave you alone, or else they will be fined.

Bankruptcy Myth 12: If You File For Bankruptcy, It May Cause More Family Troubles and May Even Lead To Divorce.


Filing bankruptcy is not the problem. The problem is not being able to pay your bills and not being able to provide for your family. This is what causes stress and anxiety in the marriage.  Too many bills to pay?  Want to avoid divorce? File bankruptcy.  

Bankruptcy Myth 13: You Can't Get Rid of Back Taxes Through Bankruptcy.


I can eliminate many back taxes for my clients.  Under the law, there are 4 or 5 qualifications that have to be met, but if these are met in your bankruptcy your taxes are gone.  

Note: Filing bankruptcy does not get rid of ‘withholding’ or California ‘sales’ taxes, no matter how old they are.

Bankruptcy Myth 14: You Can Only File Once For Bankruptcy Protection.


You can file and get a discharge under Chapter 7 once every 8 years.

Bankruptcy Myth 15: You Can Pick and Choose Which Debts and Property To List In Your Bankruptcy.


No. Doing so would be against the law. Under the law when you file bankruptcy, you have to list all your property and all your debts.

Bankruptcy Myth 16: You Can't Afford To File Bankruptcy.


Most people think they can't afford to file bankruptcy because they can't afford their bills. When a person or couple decides to file bankruptcy, the money used to make payments on their bills is used to pay a bankruptcy attorney. 

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