The Truth About Bankruptcy
At the Grand Rapids based law office of Jason L. Jansma, PLC, our consumer bankruptcy attorney represents clients across western Michigan in Chapter 7 bankruptcy matters. Well-meaning friends, the media, creditors with vested interests and many others have all helped to put a number of bankruptcy myths and misconceptions out there about bankruptcy and how it works. Below we have gathered some of the more common ones and provided the facts behind each of them.
Common Myths That Keep People From Filing for Bankruptcy
Only bad people file for bankruptcy. Nothing could be further from the truth. Hard-working people across Michigan are filing for bankruptcy because of serious financial hardship that was not of their making. Job loss, sudden illness, divorce and many other causes can all create a need for debt relief assistance. Filing for bankruptcy is not a crime. It is your right under the law to get the debt relief you need.
I'll lose everything I have. This is one of the most common misconceptions about bankruptcy: that after you file you will end up out on the street with nothing. The bankruptcy laws were not written to protect your creditors. They were written to protect you. The law allows you to keep certain exempt property that is necessary to live a normal life. This can include allowances for a car, a home, clothing, home furnishings and other assets.
I'll never get credit again. Not true. In fact, you may see credit offers coming in as early as six months after you receive your discharge. Many credit card lenders only look at your credit score which can go up once all of your debts have been discharged. In long-term lending situations, like mortgages and car loans, you may need to rebuild your credit a bit before you can get a loan.
I'm going to lose my 401K in the bankruptcy anyway so I may as well cash it in to see if I can pay off enough creditors to avoid filing. This is one of the first mistakes made by people having financial difficulty. 401Ks and many other types of retirement accounts are protected under bankruptcy laws. They cannot be seized or liquidated to repay creditors. Don't give away your future when the law provides the protection you need to make a fresh start.
Call for a Free Initial Consultation
Contact our office today to discuss your bankruptcy options with a lawyer. We are available during regular business hours and by appointment evenings and weekends. You can reach us by phone at 616-581-7406 (Free Office Consultation), toll free at 877-378-5541 or via e-mail.
We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.