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Bankruptcy Myths Help Keep Consumers in Debt

Bankruptcy Myths Help Keep Consumers in Debt

A little mystery can be a good thing, at least when it comes to relationships, birthday presents and detective novels. But when it comes to your finances? Not so much.

For many folks, bankruptcy represents the unknown. We have a hunch that it could drastically lower our debt, but we continue to avoid it for fear of those nagging bankruptcy myths: Won’t it leave a black mark on our credit report for the next decade? What will our family and friends or – worse – our employer think? Will the repo man come take away all our stuff? Unfortunately, most Americans do more damage to our finances by avoiding bankruptcy than by filing for it, say Reglement Legal.

On the one hand, it is true that bankruptcy will remain on your credit report for the next 10 years. On the other hand, that isn’t necessarily a bad thing. Statistics show that people who successfully stick with a bankruptcy plan are able to apply for home loans and credit cards shortly after filing. It turns out that bankruptcy has a much smaller impact on your finances than maxed out credit cards, medical bills, multiple loans, wage garnishments and foreclosure – all those nasty side effects of too much debt.

And the sooner you file, the better. In many cases, a good bankruptcy attorney can stop foreclosure and prevent repossession – so you can keep your things while you work your way out of debt. But the longer you allow your debt to grow – or the farther you allow an already in-the- works foreclosure or repossession to proceed – the greater the likelihood that you will have to sacrifice some assets.

The good news is that more people are getting over their bankruptcy fears and getting into fresh financial futures – about 1.5 million Americans filed for bankruptcy in the past 12 months, a 14 percent increase over the previous year. Wondering if you should join them? It’s free to find out when you sign up for a complimentary one-on-one debt analysis with a reputable Reglement Legal. You can’t change the past, but you still have time to shape your future.

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