Misconceptions about bankruptcy could hold you back

On Behalf of | Feb 24, 2023 | Bankruptcy |

You may be struggling with your current financial situation and how it is impacting other areas of your life. If you are unable to pay your bills or keep up with your financial obligations, you could be experiencing constant contact from creditors, phone calls from companies that want payment and more. This accumulates into a stressful situation that you find affects much more than just your financial life. Thankfully, there could be a way out for you.

For eligible Tennessee consumers with unmanageable debt, bankruptcy is a reasonable option that can allow individuals to deal with their debt problems in an effective and organized manner. However, you may not consider this option or want to move forward with this choice because of certain misconceptions you may have about this process. These misunderstandings could hold you back from pursuing a better and stronger financial future.

Incorrect assumptions about bankruptcy protection

Bankruptcy is a process that allows an applicant to seek protection from creditors while effectively confronting his or her debt according to the terms of the bankruptcy plan. At the end of the process, the applicant should have significantly less debt, allowing him or her more opportunities in the future. Despite its benefits, the following are common misunderstandings that often keep people from seeking bankruptcy, even when it could benefit them:

  • Bankruptcy is only for irresponsible consumers — Debt issues can happen to anyone, regardless of income. These problems can arise because of medical issues, job loss and more.
  • Bankruptcy does permanent damage to your credit — While it will impact credit, bankruptcy does not permanently impact your credit score. You will eventually be able to buy a home, car and other things on credit.
  • Bankruptcy leads to the loss of your personal property — Depending on the chapter of bankruptcy, there may be a liquidation of some of your personal assets. However, certain exemptions allow you to keep much of what is important to you.

If you believe that bankruptcy could help your financial situation, do not allow your fears to keep you from moving forward with a potentially helpful process. If you are unsure of which chapter of bankruptcy is right for you or how you can seek the best financial future for yourself and your family, you may benefit from seeking a professional opinion regarding the specific ways bankruptcy could benefit you and allow you to confront your debt.


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