If you find yourself overwhelmed by debt and harassed by creditors, you should consider whether bankruptcy is the right option for you. Unfortunately, many people are hesitant to even consider bankruptcy due to the many myths associated with bankruptcy. The good news is that these myths are false. Bankruptcy can be a reasonable solution to eliminate crushing financial obligations and give you a new financial start.

Common Myths Associated With Bankruptcy That Are False

You Will Lose Everything

In a chapter 13 a repayment plan is created to pay back creditors, similar to debt settlement, while allowing you to keep most or all of your assets. Even when filing a chapter 7 bankruptcy, there are certain items that are exempt such as a home, car, furniture, clothing, and items needed for work. In Texas, most people who file chapter 7 bankruptcy are allowed to keep everything they have. Of course, if you want to keep your car or home, you have to keep paying on any outstanding loan.  Experienced attorneys in Dallas who are bankruptcy specialists can advise you on which assets you can expect to keep.

You’ll Never Be Able to Get Credit Again

It may not take much time at all before you start receiving credit card offers again. The difference is that they’ll likely have much higher interest rates. Even mortgage lenders may be willing to work with you as soon as 2 years after a bankruptcy as long as other qualifying criteria are met. It is best to start to rebuild credit slowly, because the worst thing you can do soon after a bankruptcy is to fall right back into debt collection again.

Your Spouse Will Have to File for Bankruptcy Too

It is not a requirement for both spouses to file for bankruptcy together. It is not uncommon for partners to have separate finances, and one bankrupt partner does not necessarily mean the other is as well. However, if there are any joint accounts, the non-filing partner should be aware that they will now be responsible for those debts. If they are unwilling or unable to file bankruptcy, perhaps debt settlement would be a better option.

You Can Only File Bankruptcy Once

The Bankruptcy Code allows you to file more than one time, although there are limitations imposed by law that prevent people from simply filing over and over again whenever they find themselves in debt collection. After filing a chapter 7 bankruptcy, a debtor may not file again for chapter 7 for 8 years. They must only wait 4 years to file a chapter 13 bankruptcy.

Bankruptcy Means Failure

Bankruptcy is usually caused by medical problems, loss of income, or divorce. Often times the general economic conditions make it difficult to get a new job quickly or to bounce back from medical issues. These problems are not your fault. Even if you have to file bankruptcy because you just overspent your means, bankruptcy can be seen as an opportunity for a fresh start, so that you can rebuild your sense of worth, as well as improve your financial condition. The list of famous people who have filed for bankruptcy is long. The list of giant corporations that have filed bankruptcy is also long. Everyone deserves at least one chance to get a fresh start. Don't let your embarrassment or shame stop you from investigating whether bankruptcy might be right for your financial situation.