Many people suffering under financial stress are hesitant to file a Bankruptcy Petition. They are afraid they will lose property that is important to them, that it will ruin their life or they don't understand the full benefits that Bankruptcy offers. Here are a few of the misconceptions and myths that have developed around Bankruptcy and an assessment of the validity of each.
Myth No. 1: There is only One Type of Bankruptcy:
Most people are only familiar with Chapter 7 Bankruptcy. In reality, there are four Chapters of the Bankruptcy Code under which individuals may seek relief. Chapter 7 Bankruptcy offers a complete liquidation of all your dischargeable debts. Chapter 11 is a reorganization used primarily by businesses but may be used by an individual if they don't qualify to file Chapter 13. Chapter 12 Bankruptcy offers special benefits to people who qualify as a Farmer or Fisherman. And, finally, Chapter 13 Bankruptcy allows a person with regular income to reorganize their finances over a 3 to 5 year period. While Chapter 7 Bankruptcy gives a quick discharge of your debts. Chapter 13 is much more flexible and a Chapter 13 Plan can be crafted to meet each person's individual needs.
Please call our office at (513) 528-0200 or send us an email at Info@CincinnatiBankruptcy.com and we will schedule a Free Consultation to explain the different Chapters of the Bankruptcy Code and the many benefits they hold for you.
Myth No. 2: My Debts Aren't Dischargeable In Bankruptcy;
Most debts are dischargeable. Medical Bills, Credit Card Debts, Payday Loans, Utility Bills, Mortgage Loans, Car Loans, Personal Loans, Claims for Damages in a Car Accident (unless the driver was intoxicated) are most always dischargeable. Even Income Taxes, with some technical limitations, can be discharged if the tax liability is more than three years old. Likewise, Student Loans can be discharged in certain circumstances. Moreover, some debts, such as marital property divisions and certain tax penalties, are dischargeable in Chapter 13 Bankruptcy while they aren't dischargeable in Chapter 7 Bankruptcy.
If you are suffering under financial stress, please call our office at (513) 528-0200 or send us an email at Info@CincinnatiBankruptcy.com and we will schedule a Free Consultation to explain which of your debts can be discharged.
Myth No. 3: You Lose All of Your Property:
Most people don't lose any property regardless of which Chapter of the Bankruptcy Code they utilize when filing their Bankruptcy Petition. Even your home can be retain provided the equity in your home doesn't exceed the Homestead Exemption. Ohio now has one of the highest Homestead Exemptions in the United States and, as of the date of this publication, each Ohio resident can retain their residence in Bankruptcy provided their equity doesn't exceed $145,425.00. That means a married couple, who jointly own their residence, can file a Bankruptcy Petition and retain their home even if they have $290,850.00 equity in the home. There are also exemptions for most other property including vehicles, retirement accounts, cash, clothing, household property, jewelry and tools of trade among others.
If for some reason, the equity in your property exceeds the exemption, you may still be able to keep the property in Chapter 13 Bankruptcy. Provided you can fund your Chapter 13 Plan, most property can be retained in Chapter 13 Bankruptcy even if you are delinquent on the loans encumbering the property.
If you are reluctant to file Bankruptcy because you fear losing important property, please call our office at (513) 528-0200 or send us an email at Info@CincinnatiBankruptcy.com and we will schedule a Free Consultation to explain whether your property will be protected in Bankruptcy.
Myth No. 4: Bankruptcy Will Ruin My Credit:
If your accounts are all maxed out or you are delinquent in your financial obligations, Bankruptcy will probably help your Credit. In fact, when you file Bankruptcy you will be bombarded by credit card and car loan offers. The reason for this is, after filing Bankruptcy, most of your debts are eliminated and your Debt-To-Income Ratio improves dramatically. Moreover, you can only file a Chapter 7 Bankruptcy every 8 years. So, creditors know that option isn't available to you again for a long period of time.
If you are suffering with financial problems, please call (513) 528-0200 or send an email to Info@CincinnatiBankruptcy.com. You can also contact us with through our website by clicking here.
I look forward to helping you,