Top 10 Misconceptions about Bankruptcy

Resnick Law Offices

By Kelly M. Resnick, Managing Attorney, Resnick Law Offices, Bay Area

TOP 10 MISCONCEPTIONS ABOUT BANKRUPTCY

  1. Bankruptcy means the end of your financial life and never getting credit again.
    • Not true!  Before long you will get credit card offers again.  You may have to pay higher interest rates and have lower limits.
  2. You can not eliminate tax debt in a bankruptcy.
    • It depends on when you incurred the debt and what efforts the IRS has taken to collect.  It is difficult to wipe out taxes, but not impossible!
  3. You lose everything you own when you file bankruptcy, including my retirement.
    • The whole idea of bankruptcy is to give you a fresh start.  If you lose everything, that’s not giving you anything to start with.  The “exemption” system helps protect certain assets from your creditors, including your car, your home and in most cases, 100% of retirement accounts!
  4. I can keep…

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