Common misconceptions about bankruptcy

On behalf of The Rollins Law Firm posted in Personal Bankruptcy on Friday, March 29, 2013.

A financial coach recently shared some words of wisdom and destroyed some myths about bankruptcy. She emphasizes that personal bankruptcy does not means the end of a person's life, and they need to have all the facts before they dismiss bankruptcy as a viable option. Someone who files bankruptcy and works through the process is usually better off than a person who carries around the baggage of financial mistakes on their credit report for years.

Some people think they may never be able to get a debit card if they file bankruptcy; however, that is not always the case. In some situations, if a person needs to open a new checking account, the bank could turn down their application. However, they will be able to apply for a pre-paid debit card, and their credit history is not the deciding factor for getting this card. These cards can help people rebuild their credit and learn how to handle financial matters.

Another concern many people have is that filing bankruptcy will affect their ability to find work. This is not true in most situations. However, people may later need to explain the reasons they filed bankruptcy on a job application.

People sometimes think that filing bankruptcy means they could lose their car, retirement money or even their home. However, bankruptcy could protect those assets from creditors although debtors might need to bring delinquencies current in some cases, especially on a home.

Debtors often have misconceptions about the protections bankruptcy will and will not afford. A bankruptcy attorney in Mississippi may be able to dispel many of the myths associated with filing bankruptcy.

Source: Global Grind, "Wisdom Wednesdays With Lynn Richardson: Bankruptcy Myths 2," Kesley Paine, March 13, 2013

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