Facts about Bankruptcy

bankruptcy 09In the past people viewed bankruptcy as something negative or taboo that was not spoken about. This way of thinking is changing rapidly these days.

Nowadays people are considering bankruptcy more and more as a solution to their debt problems. In fact, filing for bankruptcy might be the only way yo be totally debt free.

We all know that filing for bankruptcy is a way of erasing our debts. However, this depends on what type of bankruptcy is being filed. The relief you get depends on the chapter that bankruptcy if filed under.

Chapter 7 is usually filed to erase credit card debt and have a fresh start. Chapter 13, on the other hand, is filed to stop foreclosures on homes even just before a scheduled foreclosure date.

Of course, everyone cannot file nor qualify for bankruptcy. You need to get a bankruptcy attorney to assess your situation and advise you on whether you are qualified for bankruptcy or not. He can also tell you what chapter would best suit your situation. Even if bankruptcy is not an option for you, or you do not qualify there are other debt relief choices an attorney can advise you about.
In the United States, the majority of all bankruptcies are filed under chapters 7 and 13. Few bankruptcies are submitted under chapter 11 or chapter 12, as well as fewer are filed under chapters 9 and chapter 15. Chapter 7 is filed mainly by those with credit card debts and other unsecured financial debt. Chapter 13 is filed mostly by those who wish to save their house from foreclosure.

One of the biggest myths about bankruptcy is that only low-income earners file for bankruptcy. This might not be further from the truth. In reality, low, middle and high-income earners all file for bankruptcy. Many notable people in society have filed for bankruptcy. Filing for bankruptcy is a method of gaining total debt relief and gaining a fresh start. If your attorney has told you that bankruptcy is your best solution, you should follow his advice.bankruptcy 11

Another misconception about bankruptcy is that it ruins your credit rating. In fact, bankruptcy gives you debt relief and a chance to build up a fresh credit history. The reason is that the lenders will stop reporting late payments and then you can rebuild your credit rating.
Another misconception about bankruptcy is that you will lose all your assets when your file bankruptcy. This is not true. Most of the times, you will keep all of your possessions when you file for bankruptcy.

Finally, if you are considering filing for bankruptcy ensure that your decision is based on facts and get some professional advice before moving forward.