Dezenberg & Smith, Attorneys At Law - Bankruptcy

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Three common myths about bankruptcy

According to the Director of the Administrative Office of the United States Courts, there were over 730,000 filings for personal bankruptcy in 2019. This year, the percentage of bankruptcy petitions filed with the courts have dropped dramatically. Closure of the courts in response to the coronavirus pandemic is likely one reason. Additional factors may include suspended payments on federal student loans and mortgages as well as leniency from credit card companies and other creditors. Another: misunderstanding about how the process works and how it can impact one’s life.

These forms of leniency and extensions that result from the pandemic will come to an end. When that happens, you may find yourself struggling to meet financial obligations in ways you never imagined. If you find yourself in this situation, it is wise not to let common misunderstandings about bankruptcy hold you back. This post will discuss and debunk some of the more common myths that surround bankruptcy.

Myth #1: You will lose everything.

This is not correct. In many cases, those who go through bankruptcy will complete the process with many assets still intact. Those who use the most common form of relief, Chapter 7 bankruptcy, will generally keep their home and vehicle. This is because bankruptcy law provides exemptions for day-to-day life. Additional exceptions may also apply. For example the law also often protects retirement assets from the reach of creditors during bankruptcy.

Because these assets are generally protected, it is important for those who are considering bankruptcy to seek counsel early on when facing financial difficulty. Do not unnecessarily use these assets to bring down debt.

Myth #2: Bankruptcy will destroy your credit.

This is also not an accurate statement. Yes, your credit will take a hit initially. But it is very likely your credit is already taking a hit and could suffer even more if you do not seek relief through bankruptcy. Missing bills because you cannot make the payments will also negatively impact your credit. This way you are taking control and can focus on your financial future.

Once approved for bankruptcy, you can begin this focus on your financial future by actively rebuilding your credit. Steps that help build your score include paying bills on time and even getting a secured credit card as long as you pay off the balance every month.

Myth #3: Filing for bankruptcy shows failure.

Getting relief through bankruptcy is not a sign of a character flaw. Instead, it shows that you were wise enough to use available tools to help take control of your finances.

Reviews

“Mr. Dezenberg is very professional and friendly. My husband and I didn’t feel rushed. He explained the process in detail, and he made us feel really comfortable.” – Leticia

“Mr. Dezenberg was the nicest and most helpful lawyer I’ve ever met.” – Melissa

“several other attorneys that I asked, who don’t practice this type of law, recommended him.” – AJ

“John has represented me on more than 1 occasion and with excellent results.” – Donna W.

“Not only is he very competent, but he is always responsive and he really cares about his clients.” – Phil G.

“John is one of the best bankruptcy attorneys in North Alabama.” – Eric Artrip

“I never felt rushed at my appointments. I would highly recommend him to anyone who needs a bankruptcy attorney.” – Lisa

“His vast experience of the law makes him a powerful advocate for his clients.” – Thomas Jarvinen

“He was very open and honest and to the point. I would recommend him any day of the week.” – Tina

“He was very professional, not once did he talk down to me nor made me feel bad about myself.” – Gloria L.

“Brandon gave me the legal advice I needed. He is very knowledgeable and answered every question I asked him.” – Celeste

“I would recommend Brandon Smith to anyone that needed a great Bankruptcy Lawyer.” – John W.

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G. John Dezenberg Jr.
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Brandon N. Smith