Bankruptcy in California – Misconceptions You Need to Know
Bankruptcy is a legal process that many people are not aware of enough. Though you might think you rightly know about bankruptcy, there are many misconceptions that the world has held onto. These misconceptions might be keeping you from filing or seeking help. You can evaluate the potential benefits of bankruptcy by clearing them. Here are some popular misconceptions that you need to know about bankruptcy to help clear things up.-
You Lose All Your Assets
The most common misconception is that you will be losing everything when you file for bankruptcy. It is simply not true. In most cases, you will be able to keep all of your assets, unless you own something extravagant that can be sold to cover the cost of your debts. In majority of bankruptcy cases, you are able to keep your assets and even reaffirm things like your home and auto loans. Bankruptcy Exemptions law is also available in California to help you. It had created to protect your property in the course of bankruptcy.
You will Have No Credit After Filing
Though your credit options will be different from what they were before filing, you will be able to get some credit after filing and take out small credit lines to help build your credit score back following bankruptcy. You may only have access to small credit lines to start with, but as you pay on time and create your credit back up, you will be given more options and better credit as time goes on.
You will Lose Your Business
You do not need to worry about losing your business after you file for bankruptcy. You can reaffirm loans, and keep your business intact so that you can start making money again after your bankruptcy filing has been done and settled. You are not losing your business if you file for bankruptcy, but you may need to restructure after you file.
You and Your Spouse Both Have to File
Married couples have the option to file for bankruptcy together or individually. You can file on your own and not involve your spouse. In a bankruptcy case taking your name off from debt and leaving your spouse to pay, you will likely strain your marriage and make things much more difficult. If you both have joint debts, it is often best that you file together to get out of the debt. And if you both are not filing together, you will need to include information about your spouse such as name, income on your filing paperwork.
You Can Only File for Bankruptcy Once in Your Lifetime
Another misconception is that you can only file for bankruptcy once in your lifetime. You can file more than once but with different time frames that apply to Bankruptcy filing. For example, you must wait for six years to file a Chapter 7 bankruptcy or two years to file a Chapter 13 bankruptcy. It is best that you must take time to talk to a bankruptcy attorney about your misconceptions and figure out what type of bankruptcy will suit you.
Bankruptcy Cannot Stop Legal Action Once it starts
Another misconception is that once a bankruptcy starts, it cannot stop. But it is wrong. You can end it any time, even after it has started and is on the way to completion. If you want to stop your bankruptcy after it’s already started, you have to follow some specific guidelines. Your Bankruptcy Attorney has to file a motion to dismiss the bankruptcy case, and it will have to be approved by the judge overseeing the case.
There is a Minimum Debt Required to File
There is no minimum debt required to file for bankruptcy in chapter 7, chapter 13, or any other type of bankruptcy. You can file for any amount of debt, but it is not exactly a great idea to file for small dues.
When you do have a larger debt, it is harder to pay off in the long run. The smaller the debt, the more chances that your bankruptcy is going to be denied. Smaller debts are more manageable and since you can only file for bankruptcy every few years, you do need to keep that in mind as well.
Filing Is Stressful and Tedious
The last thing we want to discuss is that filing a case can be stressful if you are filing on your own without any help. It can be far easier if you have an attorney that can help. If you are filing for bankruptcy in California, an expert bankruptcy attorney can help you to get the best options and make the process simpler and faster.
With the help of an efficient attorney, you can get your bankruptcy handled smoothly. He can assist and guide you with the best bankruptcy options available. Debt is not something anyone wants to deal with, and bankruptcy is a legitimate way to achieve debt relief and get a fresh start.