It is a shame that there is no “Snopes” service for bankruptcy myths and urban legends. There are many things that people say about bankruptcy that are simply just false. The problem is that it is hard to make an informed decision without the correct information. Many people believe the wrong things about what can and cannot happen in bankruptcy.
The first falsehood is that somehow you can have a free house or car if you just file bankruptcy. This would be great, were it true! However, a house or a car must be paid for if you plan to keep it. What is true, however, is that you get a choice. Bankruptcy may allow you to give up that vehicle or house you can no longer afford and restructure your other debts so that you can continue living an affordable life.
Many people are afraid they will lose their house, cars, bank accounts or retirement if they file. The good news is that in Texas, most people keep everything they own except the credit card debt! This is fairly logical. If people were going to lose everything, they would never file. Other people are concerned that they will lose their jobs. The good news is that it is illegal to fire someone for filing bankruptcy. The other truth is that most employers who are concerned about credit scores are concerned about employee theft. The employee who files bankruptcy is taking care of their debt situation. The employee who does not file bankruptcy is much more likely to steal than an employee in bankruptcy. Most bankruptcy practitioners have had the experience of having a bank employee come in to the office after their employer required a bankruptcy filing to keep their job. It is also true that many government jobs require a bankruptcy filing in order to maintain security clearance.
Many people believe they will never be able to buy a house or car again. In reality, if a person has extreme credit card debt, they are less of a risk after they file than before. Most clients have reported that they had little or no trouble buying a car or house a couple of years after the case is ended. We actually have clients who have to purchase automobiles while they are in a Chapter 13 repayment bankruptcy and have gotten very good interest rates.
There are many positive results which occur when a person files bankruptcy. However, bankruptcy does not work for every person. That is why a person thinking about filing a bankruptcy should seek the opinion of a professional to see if it would be beneficial. The real key is recognizing that there is a problem. If most of your waking hours are used to attempt to balance your creditors or if your sleeping hours become waking hours because of the stress, it is time to take action. If you are in debt, come see us. Book an appointment with a skilled bankruptcy attorney. At Bailey & Galyen, we would like to help you achieve your financial independence without all of the headache.