Let’s Bust The Misconceptions About Bankruptcy

You have probably heard many misconceptions about bankruptcy: Bankruptcy is shameful. Bankruptcy is admitting defeat. Bankruptcy cannot save your situation.

If you have considered bankruptcy but never taken that first step, these myths may be the reason holding you back. You should not let these falsehoods put you off from filing Chapter 7 or Chapter 13 bankruptcy in Texas.

Here, we will discuss the truth behind four common bankruptcy myths:

Bankruptcy Is Shameful

No one should feel ashamed about filing bankruptcy. Bankruptcy is actually a chance for a fresh start. It allows people who have unmanageable debt to wipe their slates clean by discharging debts from personal loans, credit cards and medical bills.

Many people have filed before, and many will in the future.

Bankruptcy Will Destroy Credit

Following a bankruptcy, your credit score will probably drop, but only temporarily. Over time, you can rebuild it and once again have strong credit. The purpose of bankruptcy is to help you move toward a better financial future, not permanently ruin it.

Bankruptcy Is For Irresponsible People

The stigma surrounding bankruptcy is deeply entrenched. Many people mistakenly believe that anyone who files bankruptcy must be financially irresponsible.

It is true that a portion of people who go bankrupt made irresponsible decisions, but people file for numerous reasons. Some people have overwhelming medical debt from unexpected injuries or unavoidable conditions. Some lose their jobs and cannot keep up with payments. Others experience an unexpected life event that causes them to go into debt.

The truth is that debt affects all kinds of people.

Bankruptcy Is For Other People, Not Me

In 2016, approximately 800,000 people in the United States filed bankruptcy. The important thing to know is that bankruptcy has helped people who were in the same position as you—and it may be able to help you, too.

Learn More About Bankruptcy — Talk To A Lawyer

If you have questions about filing bankruptcy, talk to our attorney at William H. Lively, Jr. WHL, PLLC, today. You can schedule a free consultation at our Tyler office by calling 903-920-0008 or by sending an email.