Myth #1: You Are Able to Declare Bankruptcy Just By Announcing it in Public
Filing for bankruptcy is not just as easy as announcing it and there are Bankruptcy Myths in Arizona that are floating around. Bankruptcy filing requires steps such as: paying a fee, completing credit counseling and also submitting legal paperwork and financial disclosures.
Myth #2: You Are Only Allowed to File Bankruptcy Once
While there are laws regarding the frequency in which you file for bankruptcy, the following is true:
You can receive a discharge from a chapter 7 bankruptcy once every 8 years
You can receive a discharge from a chapter 13 bankruptcy every 2 years
If you discharge debt through a chapter 7, you must wait 6 years before getting a chapter 13 discharge
If you discharge debt through a chapter 13, you must wait 4 years to obtain a chapter 7 discharge.
Myth #3: A Bankruptcy Affects Your Spouse
If you’re married and have separate debt, filing bankruptcy does not automatically affect your spouse’s credit. If the debt is in both your names, then it’s advised by a phoenix chapter 13 bankruptcy lawyer that you file together. Otherwise, a creditor will demand payment for the entire debt from the non-filing spouse.
Myth #4: You Can Go to Jail for Debt Owed
It is not against the law to owe money. This means you cannot go to “debtor’s prison” in the United States.
Creditors are able to sue you for debt, as well as take you to court, put liens against your property, and garnish your wages, but they are not legally able to send you to court.
Myth #5: Filing for Bankruptcy is Expensive
Filing fees for chapter 7 and 13 bankruptcies vary from state to state, but are no more than $300. While hiring an attorney can add to this, it’s always advised that you work with a bankruptcy lawyer because bankruptcy laws are complicated.
It’s much safer to hire and pay for a lawyer than pay penalties in bankruptcy court.
Finding the Right Lawyer For You
You may still be able to keep nonexempt property depending on the circumstances. If you are filing Chapter 7 or Chapter 13 bankruptcy, you need an experienced Arizona bankruptcy lawyer on your side. This can be a daunting process. Ask friends or family members for a legal referral.
Give Phoenix Fresh Start Bankruptcy Attorneys a call at 602-598-5075 to schedule a free consultation with one of our bankruptcy attorneys. If you have any other questions about bankruptcy, one of our attorneys will be more than happy to offer advice on your particular situation.
