Getting Your Finances Back On Track

Exposing myths about bankruptcy

On Behalf of | Sep 16, 2023 | Bankruptcy

Filing for bankruptcy will have a significant impact on your credit score and creditworthiness. It’s also possible that you might cede property to your Tennessee creditors to help pay down your debts. However, for many, the process of seeking protection isn’t as bad as what some may imagine it to be.

You’ll lose everything

One of the biggest myths about bankruptcy is that you’ll lose all of your possessions. The truth is that state and federal law allow you to keep at least some of the equity in your home, car or other possessions. Furthermore, you will be allowed to keep a car, tools or other assets that you need to get to work or school or to care for your kids. Finally, you can keep clothes, family heirlooms and other items that don’t necessarily have significant financial value.

You’ll never get credit again

The truth is that some credit card companies will start chasing your business the moment that your case is discharged. This is because you won’t have as much debt, which can make it easier to make future credit card payments. You should also have an easier time getting a mortgage, car loan or other types of secured loans within 12 to 24 months of obtaining protection from creditors.

You’ll be an outcast from society

These days, filing for bankruptcy doesn’t have the same stigma that it did in the past. In fact, the bankruptcy system was put in place to encourage people to start businesses, buy homes or take other risks that help grow the economy. Therefore, you shouldn’t worry about losing friends, not finding work or similar consequences just because you struggled to pay your bills.

Filing for bankruptcy will ideally be considered an option of last resort. However, doing so may be able to help you build a stronger financial future for yourself and your family without the need to give up assets.