Bankruptcy is often considered as the last resort since it comes with far-reaching consequences. But even when it’s the best option to get finances back in order, many people hold back or avoid taking action because of the myths and misconceptions concerning bankruptcy. This results in people putting themselves through extended periods of unnecessary financial and emotional turmoil.
This article addresses 5 common myths that our attorneys have encountered when interacting with clients. Our goal is to give NKY bankruptcy facts so residents can make informed decisions when determining whether it’s the right course of action for them.
1. Filing For Bankruptcy is Difficult
While there are two bankruptcy filing options, Chapter 7 and Chapter 13 and each comes with its own rules, it’s not a difficult process to undertake especially with the help of an experienced attorney. Your attorney will offer you all the facts based on your situation, help you choose the right option, and file bankruptcy on your behalf. With an attorney by your side, the process is pretty straightforward.
2. I Will Lose Everything I Own
Perhaps no other myth is more believable and incapacitating than that if you file for bankruptcy, you’ll have to part with every single possession you have. As a Northern Kentucky resident, you are allowed to claim as many federal or state exemptions as applicable to keep creditors off your property. The truth is that 99.99% of the time, people who file for bankruptcy keep all of their personal property.
3. I Will Never Get Credit Again
This is not true. People who file for bankruptcy in Northern Kentucky start receiving credit offers as soon as they receive their discharge. Banks target people who have filed for bankruptcy because their old debts have been cleared and they cannot file for bankruptcy for another eight years. It’s prudent for a person coming out of Chapter 7 or Chapter 13 bankruptcy to ensure they don’t make bad financial decisions that will pull them back into financial trouble.
4. I Can’t Buy Property
Here are the facts. You can buy a property after filing for Chapter 7 or Chapter 13 bankruptcy in NKY. What varies is the waiting period depending on the bankruptcy you filed and the type of loan you choose.
Most government-backed loans require a one to two-year waiting period from after the discharge while conventional loans require a four-year waiting period from the date you filed for bankruptcy.
5. I Can Only File for Bankruptcy Once in a Lifetime
During your lifetime, you can file for bankruptcy in Northern Kentucky as many times as you need to. Bankruptcy can help you sort out financial problems caused by job loss, divorce, illness, or any other crisis.
There is no limit to how many times you can file but there are time limits to observe between each filing. In Northern Kentucky, you can file another Chapter 7 eight years after the last filing date and another Chapter 13 after two years. It’s also possible to switch from one chapter to the other.
Hire an Experienced Bankruptcy Attorney
Now that we’ve had NKY bankruptcy myths debunked, we believe you can take the first step towards sorting out your financial situation and getting the fresh start you deserve. W. Ron Adams Law has over 33 years of experience as a bankruptcy attorney in Northern Kentucky. He can help you navigate the process comfortably from start to finish. Call to schedule your free bankruptcy consultation to get started.