When people hear the word Bankruptcy, they tend to freak out.  It can provoke thoughts of financial ruin and sometimes filing for bankruptcy can be viewed as a form of punishment.  However, bankruptcy exists to help people get out of dire situations.  All of us are subject to hard times and some of us fall into holes that we can’t get ourselves out of.  Bankruptcy can provide a necessary escape.  Oftentimes, people will delay filing bankruptcy, even though it’s obviously the right choice, because they don’t understand what it is.  To help you see that bankruptcy isn’t as bad as many presume, let’s dispel some common misconceptions that surround it.

What Bankruptcy Isn’t

When people think of bankruptcy, they often think of big headlines where companies go bankrupt and lose everything.  They start to believe that they will lose all their money and belongings.  This is not the case.  For the majority of cases we file, we are able to protect all of our clients’ property.

Another common misconception is that bankruptcy destroys your ability to get good credit in the future.  By wiping out existing debt, bankruptcy gives you a clean slate and an enhanced ability to stay current on payments.  It also provides you with an invaluable learning experience and can teach you how to stay out of debt in the future.  By helping you form good habits, bankruptcy can almost certainly help your credit score improve.  And while filing for bankruptcy goes on your record, that record is erased after 10 years in the case of a Chapter 7 bankruptcy and after 7 years in the case of a Chapter 13 bankruptcy.

Many people look at bankruptcy as a highly stressful and unhealthy process.  And although filing for bankruptcy takes some effort, crushing debt is far more stressful.  Arguing that bankruptcy isn’t worth the stress is like telling someone who’s drowning to not hold onto a life preserver because it takes too much work.

Clearly, bankruptcy will not add stress to your life. It will, in fact, do the exact opposite.If you have any questions or concerns about bankruptcy, its drawbacks, or its benefits, contact your local Yuba City bankruptcy attorney at (530) 797-4402 for a free consultation

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