When your debts have become overwhelming, whatever the reason behind this may be, it is almost certain that you will be feeling incredibly stressed, perhaps a bit confused about how best to proceed, and worried about how your future may look after you file for either Chapter 7 or Chapter 13 bankruptcy. There is a wealth of information available online about all aspects of debt management and bankruptcy, however, as with almost everything else you may be researching on the internet, it is important to know how to separate the fact from the fiction. Bankruptcy can be daunting enough without falling foul of online scaremongering and fallacies, so our Salt Lake City Chapter 7 bankruptcy attorney will soon dispel some of the most common myths you may have believed.
Bankruptcy is nothing to be ashamed of, and you are far from being the only person in Salt Lake City currently contemplating it as an option. In fact, in 2016 alone, Utah saw over 11,000 people file for bankruptcy, with around 6,800 filing for Chapter 7, and almost 5,000 opt for Chapter 13. While you are trying to decide which option is most suitable for you, you should seek legal guidance and support from an experienced Salt Lake City bankruptcy attorney. In the meantime, here are a few myths you should not let deter you from putting an end to your mounting debts.
It is easy to understand why this particular bankruptcy myth has gained so much traction, as it is human nature to focus on what worries us most. What could be more worrying than potentially losing your home, particularly if you have young children to think about? The truth of the matter is considerably less traumatic and, although Chapter 7 bankruptcy will require some property to be liquidated, certain properties can be exempted. Both Chapter 7 and Chapter 13 offer some alternatives to losing a property, which can be discussed with your Salt Lake City bankruptcy attorney.
This myth may not be too concerning, but it is inaccurate and misleading at best. While much of your debt will be cancelled when you file for bankruptcy, you will remain liable for certain debts such as child support, criminal restitution, and student loans. Should you opt for Chapter 13 bankruptcy, you will be required to complete a repayment plan before being discharged.
Again, this is a myth. While you should be very careful when entering into credit agreements in the future – after all, you do not want history to repeat itself – providing you manage your finances well in the future, you should be able to get a mortgage, or secure other finance options going forward. Although bankruptcy can remain on your credit file for up to ten years, you could find that filing for either Chapter 7 or Chapter 13 bankruptcy can actually lead to your credit score recovering more quickly than had you not filed. You may be able to start rebuilding your credit using a secured card shortly after being discharged from bankruptcy, and you could successfully obtain a mortgage within around two to four years, on average. Bear in mind that these timescales are intended as a guide only, and not a guarantee.
If your debts have become unmanageable, bankruptcy can be a far preferable option to continuing along your current route of stress and worry. When you discuss your circumstances with an experienced Salt Lake City attorney, they can recommend either Chapter 7 or Chapter 13 bankruptcy as the most suitable option.