Bankruptcy filings are on the rise in the United States. And for every person who starts the process, there are a handful of others who are scared to make the same decision. The problem? The longer you go without acting, the worse your financial situation is going to get.
Don’t let fear freeze you—let’s debunk a few myths about bankruptcy so you can take back control of you r life.
Afterwards, we hope you’ll have a better understanding of how this taboo process can actually be the first step in getting your life back.
1. Fear Over What Others Will Think
Even though logically we know we shouldn’t put so much value in what other people think about us, at the end of the day it’s human nature. So many individuals struggling financially are scared to even explore the option of bankruptcy because they are afraid of what family, friends, or even complete strangers think of them.
Feelings of failure become almost too much to carry and keep people from seeking the help they need.
In reality, even if those in your circle have never filed bankruptcy, almost everyone understands financial hardships can come up in life, and have experienced them firsthand.
Give those around you a chance, because they’ll likely be far more supportive than you think. Plus, it’s important to remember it’s no one’s business but your own! Unless you need explicit help from someone, you don’t owe anyone the details of your financial situation.
2. Fear They’ll Lose Everything
When you hear the word bankruptcy, it’s easy to immediately assume “I’m going to lose everything I own.” But that’s not actually the case. While some nonexempt assets may be sold off, such as a car, recreational items, or an additional residence to reduce some of the debt, assets like your home or primary vehicle are likely exempt, meaning you are not at risk of losing them even if you file.
Instead, your debts and income will be evaluated to come up with an appropriate repayment plan once assets that can be sold are liquidated.
In fact, without filing Chapter 7 you are actually more likely to lose your home. For most consumers, realizing they’re not going to be left without a roof over their head is enough reassurance to at least explore the available options.
3. Fear They’ll Never Recover
In addition to losing it all, a lot of people facing bankruptcy mistakenly believe that their credit will never recover. They assume they’ll never be able to get a loan again for things like a new car or credit cards.
While it will of course be difficult to rebuild and interest rates will initially be high, it is definitely possible for your credit score and financial stability to recover following bankruptcy.
After all, that’s the reason the process was created. Plus, the filing won’t stay on your record forever. Depending on the route taken, the mark will be removed after seven or ten years assuming all of the stipulations have been met.
But it’s important to remember, the longer you wait, the worse your finances can get, and the harder it becomes to rebound. So don’t wait – act now if you’re concerned you’re in over your head.
Recap
If you’re facing bankruptcy, it’s helpful to remember you’re not alone. Each year, thousands of individuals and families must file to start the process of regaining their financial independence.
The difference between these people and those who don’t file? They realize that unfounded fears surrounding bankruptcy keep a lot of people trapped in unnecessary debt, but there’s truly a way out. So, don’t let the myths surrounding bankruptcy send you further into a debt spiral. Instead, reach out to an experienced and reputable bankruptcy lawyer to be sure you get the facts and discuss your specific situation.
Wipe Out Debt with a Massachusetts Bankruptcy Attorney
Call Hines Law Offices today for a Free consultation and take the first step toward financial freedom. We are an experienced bankruptcy law firm that has been providing affordable debt solutions to individuals throughout the greater Boston area for more than twenty years.