Learn about the Five Bankruptcy Myths in Littleton, Colorado
Due to worries stoked by myths and misconceptions about bankruptcy, many people choose not to obtain debt relief. Truth be told, declaring bankruptcy may be one of the best decisions you’ve ever made for your present, future, and family. Despite the fact that the word “bankruptcy” can be unsettling, it’s a good thing that this popular misconception is untrue. This and other myths about bankruptcy in Littleton, Colorado are important to uncover.
Learning the truth about bankruptcy is the first step to ensuring the process goes smoothly. At the Law Office of Clark Daniel Dray (debtfreecolorado), you can be sure that a bankruptcy attorney will inform and educate you about the myths about bankruptcy in Littleton, CO.
These are the five most prevalent bankruptcy myths.
- Short sales and loan modifications are viable alternatives to bankruptcy.
- If you file for bankruptcy, you will lose everything.
- You can never obtain a loan or a mortgage.
- Everyone will be aware of your bankruptcy filing.
- I am only permitted to file for bankruptcy once.
A bankruptcy attorney in Littleton will first go over the bankruptcy procedure with you, including what it is and is not, as well as how it can eventually improve your overall financial situation. Reach out to a bankruptcy attorney right now for a free consultation.
What Are the Important Things to Know About Bankruptcy?
A bankrupt person or business is unable to pay its debts. At the beginning of the bankruptcy process, a petition is filed by the debtor or, less frequently, by creditors. After all the assets have been reviewed and evaluated for the debtor, some of the debt may be partially fulfilled utilizing the assets.
- By removing unmanageable debts and allowing creditors to seek some compensation based on the person’s or the business’ liquidated assets, bankruptcy gives a person or corporation a second opportunity.
- The ability to declare bankruptcy is said to benefit the economy as a whole since it gives people and businesses another chance to get credit and distributes a portion of the debt repayment to creditors.
- Federal bankruptcy courts situated everywhere in the United States handle all bankruptcy-related cases. In federal bankruptcy cases, the bankruptcy court decides everything, including whether a debtor is qualified to file and if their obligations should be discharged. Most bankruptcy proceedings are handled by a bankruptcy trustee, a representative of the debtor’s estate at the hearing chosen by the Department of Justice’s United States Trustee Program. The debtor often has minimal direct interaction with the judge unless a creditor complains.
The law firm’s Colorado bankruptcy attorneys will provide you with individualized support and special attention each case demands, be it for bankruptcy or estate planning concerns. An attorney will also straighten out the most common bankruptcy myths in Littelton, Colorado for a smoother process. Reach out to an attorney right now for a free consultation.
What are the 5 Common Bankruptcy Myths?
The following are some of the most common bankruptcy myths in Littleton, Colorado:
Myth #1: Short sales and loan modifications are viable alternatives to bankruptcy.
Some people hope to stay out of bankruptcy by selling their homes or requesting a loan modification. They are encouraged to short-sell by lenders, and the government is pushing for repayment plan negotiations, which gives them hope. Yet, fewer than 10% of these efforts succeed. Many debtors invest valuable time in trying to find a solution only to file for bankruptcy many months later.
Myth #2: If I file for bankruptcy, my home, car, and personal property will be taken.
False. A planned foreclosure or repossessed property can be prevented right away with either a Chapter 7 bankruptcy or a Chapter 13 bankruptcy. If the secured obligation is current and the property is exempt, a debtor who files for Chapter 7 bankruptcy may keep their home, several vehicles, and personal belongings.
Even if they are behind on their monthly payments and/or hold non-exempt property, a debtor who files for Chapter 13 bankruptcy is still allowed to maintain their home, several vehicles, and personal belongings under a debt repayment plan.
If you need assistance choosing a bankruptcy chapter, our firm in Colorado can provide it.
Myth #3: You can never obtain a loan or a mortgage.
Contrary to popular belief, declaring bankruptcy does not preclude future loan or mortgage applications. Within months of the bankruptcy filing, a lot of lenders actually offered higher-interest loans. After filing for bankruptcy, many borrowers who have been discharged and have a suitable income can anticipate getting approved for a conventional mortgage quickly and a government (VA/FHA) mortgage two to three years later.
Myth #4: Everyone will be aware of your bankruptcy filing.
Definitely not. The chances are excellent that the only people who will learn about a file are your creditors and the individuals you notify unless you’re a well-known individual or a significant organization and the filing is covered by the media.
This idea spread after a few tiny newspapers started publishing bankruptcy information, but it is now much less widespread, and your bankruptcy information won’t end up in the papers or tabloids. Just your creditors, cosigners, and a few other people we might need to notify about your bankruptcy will be aware of it.
Hence, you must keep the information to yourself if you don’t want everyone you know to know that you filed for bankruptcy. If you’re struggling in determining or seeing through the myths about bankruptcy in Littleton, Colorado, consider talking to a bankruptcy attorney.
Myth #5: I am only permitted to file for bankruptcy once.
This is not true. You can often file for bankruptcy again if you’ve already done so and received a discharge. For instance, there is an eight-year waiting period between filings under Chapter 7 and later filings under Chapter 7. Usually, with only a three-year plan, there is only a four-year waiting period between a Chapter 7 case and a later Chapter 13 case.
In either case, please let our law office know about any recent bankruptcy filings in Colorado as well as how that case turned out.
Do These Frequent Bankruptcy Myths Still Confuse You? Get in touch with us right now!
If we have shed some light regarding the most common myths about bankruptcy in Littleton, Colorado, you’re ready to take the first step. Talk to a seasoned bankruptcy attorney from Golden Law Group. Our team at the Law Office of Clark Daniel Dray (debtfreecolorado) is ready to help and provide you with the legal advice you need.
Apart from bankruptcy, the attorney can also help you with:
- Stopping Foreclosure
- Asset Protection
- Wills and Trust
From the time you receive your free consultation to the conclusion of your bankruptcy, our attorneys at Cutler & Associates, Ltd. in Aurora and its several law offices in Oakbrook, Terrace, Skokie, and Schaumburg will offer you legal support. Don’t hesitate to reach out to an attorney right now.