Some still common myths about bankruptcy, in no particular order.
ONE: My spouse has to file bankruptcy if I file.
Uh, no, no one ever has to file bankruptcy.
The law does provide for involuntary petitions, where creditors can get together and force a person or company into bankruptcy. But you can file without your spouse, or your spouse can file without you.
TWO: Filing bankruptcy ruins my credit: I cannot borrow money for 7 years.
Your credit is already toast by the time you call a bankruptcy attorney. It isn’t the fiing that kills a credit rating, it is not paying your bills on time.
There is no 7 year provision; it is on your credit up to ten years, and you cannot file another chapter 7 for 8 years.
THREE: Creditors will take my car if I file bankruptcy.
Not automatically, that is, not just because you filed.
They want your money, not your vehicle.
First, the automatic stay imposed when you file stops all creditor collection efforts, including car repossession, until further order of the bankruptcy court.
Basically, if you have insurance and keep paying for the car, you can keep it, but talk to an attorney on the details.
Same as with a car, the mortgage companies have more houses than they know what to do with; they want your money.
Keep it insured, pay the taxes and the mortgage, and you will keep the house, but, see aan attorney for details.
FIVE: I decide what to list on my bankruptcy, I do not have to list all my debts.
My least favorite.
You are under oath, under penalty of perjury, in a Federal Court.
YOU MUST ANSWER ALL QUESTIONS TRUTHFULLY, including, who you owe money to, who even claims you owe them money, even if you dispute that.
Kurt O’Keefe, Esq.
OFFICES IN WAYNE, OAKLAND AND MACOMB COUNTIES
Phone: TOLL FREE 877-817-9504
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Five Myths About Bankruptcy