Top 15 Myths Of Bankruptcy (Unless You’re Counting) Part Three

30 Sep Top 15 Myths Of Bankruptcy (Unless You’re Counting) Part Three

11. THOSE DEBT MANAGEMENT PLANS ADVERTISED ON TV AND RADIO REALLY WORK!
FALSE – Most people are optimists about their finances. Things don’t always get better. Check out this post about Debt Management Plans.
12. YOU CAN KEEP ONE CREDIT CARD (JUST DON T TELL YOUR BANKRUPTCY ATTORNEY)
FALSE – You need to list all of your debts. In these days of computers and the internet, it is likely that the creditor will find out about your case and the card will be closed anyway. Failure to list all of your assets or all of your debts is a fraud on the Bankruptcy Court and can be punished by a fine as large as $250,000 or FIVE years in jail.
13. YOU HAVE TO PAY EVERYTHING BACK ANYWAY, SO WHY FILE BANKRUPTCY
FALSE – In A Chapter 7 case, debts are wiped out except certain taxes, child support/alimony and student loans, for example. In Chapter 13, you pay according to what you can afford over a period of time. If you are saving house, most of your payments will be going to that arrearage.
14. YOU HAVE TO WAIT 6 MONTHS AFTER CREDIT COUNSELING TO FILE BANKRUPTCY
FALSE – You need to take credit counseling through your bankruptcy attorney WITHIN 180 days of filing.
15. YOU ARE A FAILURE IF YOU FILE BANKRUPTCY
FALSE – Studies show that bankruptcies are generally caused BY HEALTH PROBLEMS, INCOME LOSS and FAMILY PROBLEMS. These are nearly the same things that cause mortgage problems and foreclosures.
16. YOU CAN T AFFORD TO FILE BANKRUPTCY
FALSE – Most bankruptcy attorneys have payment plans. A consumer bankruptcy attorney will show you how to free up money in your budget to allow you to pay the fees to file the case. In Chapter 13, part of the fees can be paid through the budget plan.

11. THOSE DEBT MANAGEMENT PLANS ADVERTISED ON TV AND RADIO REALLY WORK!

FALSE – Most people are optimists about their finances. Things don’t always get better. Check out this post about Debt Management Plans.

12. YOU CAN KEEP ONE CREDIT CARD (JUST DON’T TELL YOUR BANKRUPTCY ATTORNEY)

FALSE – You need to list all of your debts. In these days of computers and the Internet, it is likely that the creditor will find out about your case and the card will be closed anyway. Failure to list all of your assets or all of your debts is a fraud on the Bankruptcy Court and can be punished by a fine as large as $250,000 or FIVE years in jail.

13. YOU HAVE TO PAY EVERYTHING BACK ANYWAY, SO WHY FILE BANKRUPTCY

FALSE – In A Chapter 7 case, debts are wiped out except certain taxes, child support/alimony and student loans, for example. In Chapter 13, you pay according to what you can afford over a period of time. If you are saving house, most of your payments will be going to that arrearage.

14. YOU HAVE TO WAIT 6 MONTHS AFTER CREDIT COUNSELING TO FILE BANKRUPTCY

FALSE – You need to take credit counseling through your bankruptcy attorney WITHIN 180 days of filing.

15. YOU ARE A FAILURE IF YOU FILE BANKRUPTCY

FALSE – Studies show that bankruptcies are generally caused BY HEALTH PROBLEMS, INCOME LOSS and FAMILY PROBLEMS. These are nearly the same things that cause mortgage problems and foreclosures.

16. YOU CAN’T AFFORD TO FILE BANKRUPTCY

FALSE – Most bankruptcy attorneys have payment plans. A consumer bankruptcy attorney will show you how to free up money in your budget to allow you to pay the fees to file the case. In Chapter 13, part of the fees can be paid through the budget plan.

“ConnecticutGene Melchionne is a bankruptcy lawyer covering the entire State of Connecticut. He can often be found on Google+ and Twitter, where he shares information about consumer protection issues and personal finance.

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