Did you know that knowing just a few of these often-unknown bankruptcy secrets can help you with filing?
Bankruptcy isn’t necessarily something people want to achieve. Instead, it’s a helpful tool to use when your financial situation takes a turn for the worse. Under US law, you have a right to file for bankruptcy. Bankruptcy laws are in place to protect your assets and help you get your financial situation back on track.
But there’s probably a lot you don’t know about bankruptcy. Learning a few bankruptcy secrets can help you make smart financial decisions and determine if filing is right for you.
What are some of the biggest secrets of bankruptcy?
1. Bankruptcy is a matter of public record, just like most things that are related to the judicial system.
Unless your case is sealed by a judge – and there isn’t a reason it would be – anyone can see that you’ve filed for bankruptcy. But this isn’t a reason to be concerned or to avoid filing. Unless you are famous, it’s unlikely anyone will bother checking court records to see if you’ve filed for bankruptcy. In most cases, the only people who will know about your bankruptcy are current and future creditors and any friends or family you choose to tell about filing.
2. Bankruptcy might not erase all of your debt, but there’s a good chance it will erase most of it.
Certain types of loans – court-ordered fees and support payments, most student loan debt, and most tax debt – cannot be discharged in bankruptcy. However, the vast majority of other types of debt can be discharged. This alleviates a great deal of burden when you’re strapped financially.
3. Bankruptcy stops all collection actions against you.
An automatic stay is enacted the moment you file for bankruptcy. This means that by law, bill collectors must stop contacting you. The automatic stay also puts a hold on foreclosure and repossession actions against you. It doesn’t guarantee you’ll get to keep your home or any other possessions. But it gives you time to assess your situation and determine the best things you can do to protect your assets. The automatic stay isn’t necessarily a bankruptcy secret, but it’s one many people don’t learn about until they look into filing.
To learn more about the benefits of the automatic stay and how it works, check out this information from Investopedia.
4. Bankruptcy doesn’t come with the stigma that it used to.
Granted, you might not want to take out an advertisement alerting everyone you know to the fact that you’ve filed for bankruptcy. But you should know it no longer carries the social shame people once attached to it. There are just too many people in today’s society who can benefit from filing for bankruptcy for there to be the same judgmental view of it.
Bankruptcy is also not just for people who “overdid their spending” with credit cards. The majority of people today who file for bankruptcy do so because they are facing medical debt from a significant illness, the loss of a job, a drastic change in their family situation, or because of the money they invested in their education.
5. Bankruptcy is not destructive.
This might be one of the most misunderstood bankruptcy secrets. It will not destroy your credit. It also won’t mean you “lose everything.” Instead, it’s a tool that should be used when your financial situation is already in a bad way to help you make it better. Chances are anyone considering bankruptcy already has problems with their credit and could be at risk for losing their home and other assets. Bankruptcy is a way to correct these problems and give you a path to a brighter future. Over time, you’ll improve your credit after bankruptcy faster than if you did nothing.
Understanding the most important secrets about bankruptcy can help you determine if filing is right for you. To learn more or to speak to someone about your financial situation and whether bankruptcy can make it better, contact the bankruptcy Law Office of Robert M. Geller at 813-254-5696 to discuss your situation.