Few people approach Chapter 7 or Chapter 13 bankruptcy without any concerns about what the process might involve. Instead, it is much more common to involve bankruptcy as a potential solution in difficult times, but also a process that comes with several particular challenges. This article will address some of the most common fears that people have when considering filing for bankruptcy.
Bankruptcy Will Remain on Your Credit Report for Years
Chapter 7 bankruptcy might only take several months to complete and offer the advantage of discharging you from debts, but many people worry that a bankruptcy will remain permanently on their record. In reality, many people discover that the bankruptcy filings remain on their record for a period of only a few years, after which they are able to begin rebuilding their credit score.
Bankruptcy Records can be Viewed by Anyone
Bankruptcy is a legal proceeding, which many people fear means that these records can be read by anyone. To access bankruptcy records, however, a person must have your name and other personal details. A person also must have the correct information to conduct an online search, which often means that these records are better hidden than many people might believe.
Filing Bankruptcy Will Not Erase All Debt
Some people argue that because bankruptcy is not capable of discharging certain types of debt like recent income taxes or student loans, the option is not worth being pursued. In reality, bankruptcy is capable of relieving several types of debt and therefore increases your ability to pay other debts. Bankruptcy is often a helpful process even if it is not capable of discharging all of the debts that you owe.
Filing can be Costly
Many people fear that if they do not have enough money to pay for outstanding debt, they will not have enough money to pay for the fees associated with Chapter 7 or Chapter 13 bankruptcy. While the rates associated with the bankruptcy process can differ, both Chapter 7 and Chapter 13 bankruptcy can cost several thousand dollars. These costs, however, are not due up front. With the goal of having a solid credit report, however, many people discover that this amount is worth it.
Difficulties Obtaining a Home Loan
Many banks are hesitant to loan money to anyone, which goes double for people who have a bankruptcy on their record. Many bankruptcy filers discover that it takes one to four years before they are approved for a mortgage loan. The Federal Housing Authority also requires applicants to wait two years after declaring bankruptcy before obtaining an FHA home loan.
Speak with an Experienced Bankruptcy Attorney Today
If you are debating navigating the bankruptcy process, you should not hesitate to first speak with an experienced bankruptcy attorney who can help answer your questions. Contact attorney Jim A Lyon today to begin navigating the bankruptcy process.