Myths and Misconceptions in Bankruptcy

Myths and Misconceptions in Bankruptcy

Filing for bankruptcy has many benefits in the context of resolving financial problems, as well as some disadvantages. Unfortunately, there are a broad variety of common myths and misconceptions in bankruptcy that cause some people to shy away from even considering it as an option.

The Liviakis Law Firm has been working with individuals and families to resolve debt problems since 2008 and has the ability to address assumptions, concerns and questions. To dispel false or inaccurate information about filing for bankruptcy, contact me today for a free initial consultation.

Common Myths and Misconceptions About Filing for Bankruptcy

Among the most common myths and misconceptions about what happens when you file for bankruptcy is that you will be forced to give up your home, your car and all of your other possessions. Another is that your credit score will be so horrible that you will not be able to qualify for any kind of loan for several years after you file. You have also probably heard that student loan debt is not dischargeable in bankruptcy, so if that is your primary source of debt, filing for bankruptcy isn’t worth it.

In contrast, the reality is that many of your possessions, including your primary residence, some other assets, alimony payments and your salary, are usually exempt from liquidation in Chapter 7 bankruptcy.

Moreover, student loan debt is dischargeable in cases of specific undue hardship, and may be included in a Chapter 13 repayment plan (with the full balance to be repaid at the end of the repayment term of three to five years). Another myth related to Chapter 13 bankruptcy, that the full balance of your debts must be included in the reorganization of debt, is untrue as well. In many cases, only a small fraction is repaid. In some, the balance is written off completely

It is true that bankruptcy is reported to credit bureaus and remains on your credit report for seven years. However, your credit score is likely to improve over the course of the two years immediately following a bankruptcy filing due to the elimination of debt balances.

Debt Relief Guidance From a Sacramento, California, Attorney

I represent clients in communities throughout Sacramento County, El Dorado County and Placer County, California. For your convenience, I have offices in Ranch Cordova and Sacramento

An experienced bankruptcy lawyer can help you to fully understand the options available to you. Having the correct information about the bankruptcy process will help you to make the best decision to meet your financial needs. To get on the right track, contact our office for a free initial consultation.

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    Wonderful Bankruptcy Attorney!

    I retained Mr. Liviakis after a very bad experience with another lawyer who basically abandoned my case. Mr. Liviakis was thorough in his analysis of the law and the facts of the case and very prompt in responding to all of my questions. His professional handling of the case gave me confidence that the matter would be done right.

    Professional and Talented Attorney

    Very professional and talented bankruptcy attorney. He helped me though a very difficult situation. I recommend Liviakis to others in the community of Sacramento. Liviakis took time to answer all of the bankruptcy questions that I had. My case turned out very well. It was an easy experience and no stress at all.

    They Truly Cared

    After interviewing several lawyers, I decided to use Miki. Miki and his staff were knowledgeable and helpful throughout the process. They kept me informed every step of the way and made me feel like they “cared”. I have worked with a number of attorneys over the past 25 years and Miki is someone whom you can trust.

    Definitely Recommend

    I would definitely recommend Atty. Liviakis to anyone that I know that needs help to sort out their financial problem. Very easy to talk to and always prompt when I have questions. Chapter 11 Client

    Mikalah was the most informed and knowledgeable proffesional i have ever had the privilege to work with.not only did he handle our case succesfully,he treated us with dignity and respect in a very tough time. I highly recomend this attorney he is a man with integrity,a true professional.

    Chapter 7 Client

    Liviakis Law Firm was professional and empathetic to my situation. I felt that I could discuss my situation without judgment or feeling shame. I appreciated the quick communication and professional demeanor of all staff.