Bankruptcy Fact or Fiction

Posted on August 29, 2013 at 7:06am by

How much do we know about bankruptcy? We see television commercials and hear about famous people that have filed from the tabloids and it’s just human nature to make assumptions made when it comes to bankruptcy that just are not true.

Cause

Many people have never experienced severe financial hardship. Many believe that individuals who file for bankruptcy are just irresponsible when it comes to managing their money. This is not true. Many bankruptcies are a result of medical costs such as an unforeseen long-term illness that can have a devastating effect of a family’s finances. Other times individuals may be overwhelmed with legal costs associated with divorce or a wrongful conviction. Many times bankruptcy is just a result of an individual experiencing an unforeseen event in their life.

Effect

Think bankruptcy will remove any and all debts? Not so fast. If you have past child support payments before the bankruptcy, they’ll be there after the bankruptcy petition is filed. If there is restitution involved as part of legal proceedings, bankruptcy will not remove this obligation. Many people are surprised to learn about the many debt obligations bankruptcy doesn’t remove.

Easy Come

When it comes to credit cards, some people believe they shouldn’t worry how much they spend on them before filing for bankruptcy, because they won’t have to pay it back. Hang on a sec! Unfortunately many people are shocked to discover this is considered fraud. Any type of debts created as a result of committing fraud cannot be removed with bankruptcy protection.

Easy Go

There are those that believe if they file for bankruptcy, they will never be able to have a credit card or get a loan again. Not true! You’ll receive plenty of credit card offers following bankruptcy, even car loans offers. But you must be careful. In the business world, the person who has just come out of bankruptcy has just had a lot of their monthly financial obligations removed so those car loan and credit offers can get you back into trouble real quick.

There’s a lot of bankruptcy fiction provided in the media and on the internet these days. If you’re in the Kansas City are and interested in learning the facts of filing for bankruptcy, contact The Sader Law Firm. We have have the legal experience and knowledge to separate bankruptcy fact from fiction.



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