Bankruptcy Myths Part 3

It is quite amazing to know the number of myths about bankruptcy believed to be true. I this series of articles will dispel your wrong thinking about bankruptcy once and for all.

Here are a few more myths surrounding bankruptcy.

Myth #9 – “What to include in my bankruptcy application is up to me”

I can sum up what to declare in your bankruptcy application with one word – Everything. To have any chance of securing a discharge of your debts, you must list down ALL your creditors, debtors, sources of income, assets and liabilities and any other thing required by law.

Myth #10 – “I can only apply for bankruptcy once”

This is not true. In fact, the law does not limit to the number of times you can make an application for bankruptcy. However, the judge has the final say and would certainly impose certain restrictions on the number of times you can apply if you overdo it. For example, he might rule that you cannot make another application within a certain time frame.

However, there is a limit to the number of times you can be granted a discharge. The law states that you can only be granted a Chapter 7 discharge once every 8 years and a Chapter 13 discharge once in 2 years. Furthermore, once you have obtained a Chapter 7 discharge, you have to wait another 6 years before you can obtain a Chapter 13 discharge. On the other hand, after receiving a Chapter 13 discharge, there is a time bar of 4 years before you are eligible for a Chapter 7 discharge.

In all practicality, these restrictions in obtaining discharges would by themselves limit the number of times you would apply for bankruptcy.

Myth #11 – “As husband and wife, we must file for bankruptcy as a couple”

According to the law, you have the option of filing together or separately. There are pros and cons both ways and the only way to know which is better for you would be to engage an attorney like me to evaluate your situation. Please call me at our toll free number (877) 251-5551 for a non-obligatory consultation.

Myth #12 – “My family will suffer”

This is one of the most common myths I have come across and it cannot be more untrue. The total opposite is the actual truth. Not filing for bankruptcy will potentially destroy your family. The bankruptcy code is formulated to provide you relief from the stress of incessant phone calls or visits by creditors, lawsuits and other pressures.

Part 1 | Part 2 | Part 4