There are a number of myths surrounding bankruptcy in Georgia.
“Everyone will know!”
“I will never have credit again!”
“I will lose my home.”
Often these myths can keep a person from taking the necessary steps to take control of a bad financial situation. If you have been avoiding talking to a bankruptcy lawyer because of any of these myths, don’t wait any longer. Many who put it off find that they would have been much better off if they had taken this step sooner.
Here are the top 5 Bankruptcy Myths in Georgia: Debunked!
Myth #1: If I file bankruptcy, I will lose everything.
FALSE: Filing bankruptcy does not mean that you will lose your home or your vehicle. Most Chapter 13 Bankruptcies make provisions to pay for the items you wish to keep. Bankruptcy Law also provides for exemptions In fact, it is almost impossible for someone does lose their home. The law is designed to help you out of your troubles, not put you in more trouble! To keep people from losing their homes, vehicles, and more each state has filing exemptions that can protect certain assets such as:
- cars up to a certain value
- retirement plans
- household goods
Filing for bankruptcy will not leave you destitute or without a home. Your attorney can walk you through what assets you can keep while filing Chapter 7 or Chapter 13.
Myth #2: Filing Bankruptcy will ruin my credit forever.
False: In fact, many people do more harm to their credit by not filing bankruptcy and continuing to fall further and further behind in payments. The truth is, if you handle your bankruptcy and repayment plan well, you may actually have better credit in a few years than you did before you filed.
Bad credit comes from missing payments or making late payments. These two things often result from being overwhelmed with debt. Filing for bankruptcy and working with an experienced bankruptcy lawyer can actually help you manage payments more easily and reduce your monthly payment amount. This can help you build better credit for your future.
Myth #3: Filing Bankruptcy is only for the financially irresponsible.
False: Most people who file bankruptcy simply have extenuating circumstances that have led to financial trouble. Some of the most common situations leading to a bankruptcy filing are:
- major illness or accident
- loss of job
There is no knowing when any of these situations can arise, and even with the best of planning and intentions, people can find themselves faced with difficult financial situations. If you find yourself in one of those situations, don’t let this myth about bankruptcy keep you from seeking professional legal help from a bankruptcy attorney.
Myth #4: If I file for bankruptcy, I will be on my own to fix my finances.
False: In Georgia, anyone who files bankruptcy must attend classes before filing and after the bankruptcy is filed. These classes are designed to help those filing understand how to better manage their finances. They are run by certified credit counseling agencies with the ideal of keeping you out of bankruptcy court a second time. Your bankruptcy lawyer will be able to help you find the right sources to keep you moving on the path to financial recovery. The bankruptcy court is designed to help consumers manage overwhelming financial situations, not punish those who have spent too much! Your attorney will be a great source of advice for how to move forward with healthy financial habits.
Myth #5: Bankruptcy will wipe out all my debt!
False: Though many are not happy to hear it, bankruptcy is not a “tabula rasa” or blank slate where debt is concerned. When you file under Chapter 7 Bankruptcy, most debts can be discharged. However, there are some financial obligations that will not go away. These debts include, but are not limited to:
- child support/alimony/spousal support
- restitution for a crime
- student loans
- debts for personal injury caused by the debtor’s operation of a motor vehicle while intoxicated
- fines owed any government agencies
When you file under Chapter 13, the majority of your debt will simply be reduced or reorganized to help you pay back what you owe in a more manageable way. When you meet with your bankruptcy lawyer to discuss your case, be sure to disclose all of your debts so that each can be assessed. Your attorney nor the trustee will appreciate surprises when working through your case.
Talk to a bankruptcy lawyer
Many people avoid talking to a bankruptcy attorney until it is too late. They find themselves in an unbearable situation with overwhelming amounts of debt and creditors constantly harassing or threatening. There is no need to find yourself in this state. If you are over your head in debt and cannot manage to get out, call a reputable bankruptcy attorney who can help allay some of your fears and dispel some of the myths associated with bankruptcy. There are many more misconceptions about bankruptcy, but finding a trusted bankruptcy attorney will go a long way to easing your concerns.
The attorneys at Hall & Navarro are passionate about law. We serve Effingham County, Bulloch County and surrounding areas. The law offices are located in Springfield, Georgia and in Statesboro, Georgia. The attorneys at Hall & Navarro provide focused and experienced representation from your initial consultation until the resolution of your legal matter. We offer a broad range of legal services and are dedicated to serving individuals and businesses.
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