Due to the recent economic hardships facing many Georgians, our office has received several calls from individuals who are struggling to pay their bills, provide for their families, and control their mounting debt. For many people, filing for bankruptcy is a good solution to their financial problems. However, the decision to file bankruptcy is not appropriate for everyone, and all Georgians should be well informed of the possible benefits, disadvantages, and consequences of filing for bankruptcy before they decide to pursue this course of action.
To give Georgians a brief glimpse into some of the more important bankruptcy issues, we have provided below 5 things many people don’t know about bankruptcy:
1. It Costs Money To File Bankruptcy
Yes, it’s true – it does cost money to file bankruptcy. If you work with a bankruptcy attorney, you will need to pay the attorney a fee for the legal services the attorney provides. But even if you do not hire an attorney, the bankruptcy courts require a filing fee that must be paid by all applicants.
2. Filing Bankruptcy Does Not Erase All Types of Debt
While filing for bankruptcy can help the applicant significantly alleviate some forms of debt such as credit card debt, there are a number of types of debt that bankruptcy in most circumstances does not eradicate such as alimony or child support payments and student loans.
3. You Can File for Bankruptcy Multiple Times
It is possible for a Georgian to file bankruptcy multiple times, but there are limits to this opportunity. For instance, if a Georgian’s debt was discharged pursuant to a Chapter 7 bankruptcy, the Georgian cannot file for bankruptcy again until 8 years have passed since the date of that first Chapter 7 application.
4. A Bankruptcy Record Stays on Your Credit Report for 10 Years
Most people know that filing for bankruptcy may affect one’s credit score, but most do not know how long it will stay on their report. The answer is 10 years. Of course, that does not mean a person who files for bankruptcy cannot obtain a mortgage, business loan, or credit card for ten years. However, because of the long-lasting effects of filing for bankruptcy, it is highly recommended that a person consult a bankruptcy attorney before filing the application.
5. You Do Not “Lose Everything” If You File for Bankruptcy
It is a common misconception that people who file bankruptcy lose everything; their house, their car, their jewelry, all of their belongings, etc. This is absolutely not the case. The point of the bankruptcy process is to provide people with a clean financial state and the means to improve their financial lives – not to punish them by taking away everything they have. Therefore, there are a number of ways bankruptcy allows people to keep their house, their car, many of their personal possessions, etc. To learn more about how to safeguard your property during bankruptcy, contact our office today to speak to a knowledgeable attorney about your case.
Contact our office today to speak to us about your case. We look forward to working with you!