Important issues to understand about bankruptcy

Bankruptcy is an issue that can affect individuals from all walks of life in New York, and misinformation can be one of the biggest challenges in regaining your financial footing if you are considering this route. You may view bankruptcy as a negative event because of its potential impact on your credit score, or you may think that you will only be further bogged down with financial issues because of a bankruptcy. While bankruptcy is not always the ideal solution, there are instances in which it may be an excellent option.

One of the major misconceptions is that a bankruptcy will make it impossible to get a loan for a vehicle or home. However, you may be able to make inroads as you take steps to re-establish your credit so that you are ready in a few years to obtain such financing as needed. Your current car or home may not necessarily be lost to repossession or foreclosure as some bankruptcy options may allow you to keep those assets. Filing bankruptcy results in a stay of collection activities, providing time for a reorganization plan to be developed if Chapter 13 is available for you.

Another important misconception is that legal help is not necessary. It is possible to file without an attorney, but this can lead to errors of various types. Omitting a creditor from your bankruptcy, for example, might lead to that debt being retained as others are discharged. Additionally, it is important to consider various bankruptcy options and alternatives to ensure that you make the most appropriate decisions based on your personal circumstances.

Your situation is unique, and appropriate counseling and evaluation of your circumstances is important as you contemplate bankruptcy or other debt resolution alternatives. Learn more about these issues as you read our bankruptcy misconceptions page.