The Truth About Bankruptcy

Many people do not understand bankruptcy. For an individual, it is not complicated or costly. It is a legal process that enables a person to get out from under an unbearable debt burden and take control of their finances.

7 Most Common Myths About Bankruptcy:

Myth #1 – Because the bankruptcy laws have changed, filing for bankruptcy is no longer an option.

Not true. Bankruptcy is still available for most people. While the laws have changed, complete debt relief under Chapter 7 is still possible for many people. If you don’t qualify for Chapter 7, you may still be able to save your home or reduce or remove your debts under Chapter 13.

Myth #2 – If I file for bankruptcy, I will lose everything I have.

Not true. In most cases, our clients are able to keep their house, their car, and most or all of their personal possessions. Filing bankruptcy can protect those assets while reducing or removing your debts from your shoulders. The Ruiz Law Firm can help.

Myth #3 – Everyone will know I have filed for bankruptcy.

Unless you are a major corporation or a very important person, chances are that the only people that will know about your bankruptcy are your creditors. Although filing bankruptcy is of public record, the number of people filing everyday is so massive, publications are unlikely to run it.

Myth #4 – I can file a successful bankruptcy for just $199. 

Remember the old adage: you get what you pay for. This is especially true with bankruptcy. Your case involves more than just filing a petition and a lot can go wrong if you do not consult a qualified attorney as to the facts of your particular case. There is no one-size-fits-all bankruptcy. You need someone to assist you throughout your entire case. A petition-preparer cannot give you legal advice, or negotiate with creditors on your behalf, or attend court hearings and represent you there. Moreover, a petition preparer is basically a salesperson whose job it is to sell you a bankruptcy whether you need one or not! A lawyer can tell you whether bankruptcy is really right for you. Furthermore, a petition preparer may put you in the wrong chapter of bankruptcy, which could have devastating effects. As for doing it yourself, that is not advisable for the same reasons that it is not a good idea to hire a petition preparer. When you hire a bankruptcy attorney to take your case, you are paying for peace of mind, expertise, and protection. An experienced bankruptcy attorney also knows the players at court including the judges, the trustees, and creditors’ counsel, which can help your case move along smoothly.

To learn more about the dangers of Bankruptcy Petitioner Preparer scams and the risks of filing Bankruptcy without an attorney check out these recent articles:

Myth #5 – After I file for bankruptcy, I will never be able to get credit again.

Not true. You can get credit. In fact, the most important point here is that filing bankruptcy is the first step toward rebuilding your credit rating. Bankruptcy does not have the social stigma that it once had, and people often find that once they have discharged many of their debts and wiped the slate clean that creditors are willing to lend to them again. The decision whether to grant you credit in the future is strictly up to the creditor and varies from creditor to creditor. There is no law that prevents anyone from extending credit to you immediately after the filing of a bankruptcy, but creditors aren’t required to extend you credit either. You should be cautious, however, to budget and stay on top of your finances so that you maintain the benefits of having filed for bankruptcy relief. The fact is that if you take care to rehabilitate your credit, your credit score can easily go back to prime territory within just two years.

Myth #6 – Bankruptcy is an expensive and complicated process.

Not true. While it is true that bankruptcy is a complex area of the law, our qualified attorneys at the Ruiz Law Firm make filing bankruptcy easy. For a simple and convenient flat fee (which we will discuss upfront), we can file all necessary papers, and immediately stop foreclosure, repossession, and creditor harassment. Our attorneys will take care of everything and keep you informed throughout the process. The Ruiz Law Firm will do the hard work and help you to take control of your financial future.

Myth #7 – Filing for bankruptcy puts you at the mercy of creditors.

Not true. Bankruptcy can actually increase your options by reducing or eliminating unsecured debts and allowing you to take control and begin making orderly payments on your remaining debt. In some cases, you can actually choose which debts are discharged.