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The 16 Secrets Your Creditors Don't Want You To Know!



There are a lot of "Myths" (lies) out there surrounding the concept of bankruptcy. Most of these criticisms are just NOT TRUE and are designed to scare people from getting help by getting rid of their debt. Bankruptcy can solve your debt problems and more importantly get you and your family a fresh start. If you are considering a bankruptcy but are afraid about what you have read or heard others say, don't worry, we have a list to address all of the myths, lies and misconceptions.  


Bankruptcy Myth 1: Bankruptcy Doesn't Really Get Rid Of Debt.  Sooner Or Later, You Still Have To Pay It All Back. Right?


Totally NOT TRUEThe truth is this: Bankruptcy lets you get rid of certain debts "without paying for them"..."without EVER having to pay for them".  SHOCKED?  Then you don't know bankruptcy.  You need to let that sink in because it's the truth.  Bankruptcy lets you get rid of certain debts "without paying for them" ..."without EVER having to pay for them...EVER". When bankruptcy gets rid of debts...those debts are "gone"...and I mean FOREVER.  Getting rid of certain debts without you EVER having to pay them back is simply how bankruptcy works


Bankruptcy Myth 2: Everyone Will Know You Have Filed For Bankruptcy.

Unless you're famous, chances are very good that the only people who will know about a filing are your creditors and the people you slip and tell. While it's true that your bankruptcy is a matter of public record, the number of filings is so massive, that unless someone is specifically trying to track down information on you, there is almost no likelihood that anyone will even know you filed. 

Bankruptcy Myth 3: You Will Lose Everything You Have.

Most of our clients don't lose anything. While laws vary from state to state, every state has exemptions that protect certain kinds of property. Using North Carolina as an example, there are exemptions to protect such things as your house, your car, your truck, household goods and furnishings, IRAs, retirement plans, the cash value in life insurance, wages, and personal injury claims.

Bankruptcy Myth 4: You Will Never Be Able To Own Anything Again.

This is completely false. There are no laws prohibiting you from buying homes, cars, trucks, equipment, household goods, etc. Once you get what is called your ‘discharge in bankruptcy’.

Bankruptcy Myth 5: You Will Never Get Credit Again.

You are more likely to get credit after you file, than if you don’t file. In fact...and you need to hear this...FILING BANKRUPTCY MAY BE THE BEST THING THAT EVER HAPPENS TO YOUR CREDIT...and more importantly...YOUR CREDIT SCORE.  Filing bankruptcy gets rid of debts you "can't afford". Getting rid of debts you "can't afford" does 2 things: (1) It puts you in a position to handle more credit and (2) Even more importantly, it lets you get back to paying the rest of your debts "on time".  If you don't get back to paying your bills "on time", you will never have a high Credit Score. Want a Credit Score as high as 720 or even higher?  Start with a bankruptcy.  Besides, having less debt to pay after a bankruptcy makes you look more attractive to banks, credit card companies and other lenders.  In my experience, unfortunately, it won't be long before you're getting credit card offers again.  

Bankruptcy Myth 6: Filing Bankruptcy Means You're a Bad Person.

Filing bankruptcy means you’re a good person, acting responsibly. Everyone wants to pay their bills.  Everyone.  And everyone wants to take care of their family and provide their family with all the things they need.  

Bankruptcy Myth 7: Filing Bankruptcy Will Hurt Your Credit For 10 Years.

You are getting 2 completely different concepts confused with each other. You are getting the fact that bankruptcy is reported on your credit report for up to 10 years mixed up with the effect that reporting will have on your credit.  Just because something is reported on your credit report does NOT necessarily mean it will have a negative effect on your credit standing. 

Bankruptcy Myth 8: If You're Married... Both You and Your Spouse Have To File For Bankruptcy.

We have filed hundreds, and probably thousands of cases, where a husband, or a wife, but not both, filed bankruptcy. In many cases, where husband and wife both have a lot of debt, it makes sense and saves money for them to both file, but it is never a ‘requirement’ under the law. However, in many situations, there is no good reason at all for the second spouse to file.  In these situations, we just file the spouse who needs the help, and leave the other spouse completely out of it.

Bankruptcy Myth 9: It's Really Hard To File For Bankruptcy.

Not when you file with an EXPERIENCED bankruptcy attorney. The Law Offices of John T. Orcutt has been practicing bankruptcy for over  26 years. We have 9 bankruptcy attorneys who have helped well over 72,343 families get the relief those families needed and the "fresh start" they deserved.

Bankrupcy Myth 10: Only Deadbeats File For Bankruptcy.

Most of the people who file bankruptcy are good, honest, hard-working people, just like you and me, who file as a last resort after months or years of struggling to pay the bills.  You’re completely wrong in thinking that you’re a deadbeat if you file bankruptcy.  If you need to file, filing bankruptcy is actually one of the most positive, responsible, honorable and noble steps you can take on behalf of your family and your family’s future, happiness and prosperity.

Bankruptcy Myth 11: Even If You File For Bankruptcy, Creditors Will Still Harass You and Your Family.

The minute you file bankruptcy, the Bankruptcy Court issues an order telling all of your creditors to leave you alone, or else they will be fined.

Bankruptcy Myth 12: If You File For Bankruptcy, It May Cause More Family Troubles and May Even Lead To Divorce.

Filing bankruptcy is not the problem. The problem is not being able to pay your bills and not being able to provide for your family. This is what causes the stress and anxiety between husband and wife to build and build.  Too many bills to pay?  Want to avoid divorce? File bankruptcy.  

Bankruptcy Myth 13: You Can't Get Rid of Back Taxes Through Bankruptcy.

We can eliminate back taxes for our clients.  By “taxes”, we mean ‘income’ taxes, and by “old", we mean income taxes more than 3 years old.  Under the law, there are 4 or 5 qualifications that have to be met, but once these are met in bankruptcy those taxes are gone.  
Note: Filing bankruptcy does not get rid of ‘withholding’ or ‘sales’ taxes, no matter how old they are.

Bankruptcy Myth 14: You Can Only File Once For Bankruptcy Protection.

You can file and get a “discharge” under Chapter 7 once every 8 years. As for filing a Chapter 7 after filing and getting a discharge in Chapter 13, the wait is 6 years, computed from one “date of filing” to another. As for filing a case under Chapter 13 of the Bankruptcy Code, the wait is only 4 years after a prior discharged Chapter 7, or 2 years after a prior discharged Chapter 13 case. If a prior bankruptcy case was “dismissed” as opposed to “discharged”, there is no required wait time between bankruptcy filings, barring a rare court order to the contrary.

Bankruptcy Myth 15: You Can Pick and Choose Which Debts and Property To List In Your Bankruptcy.

No. Doing so would be against the law. Under the law when you file bankruptcy, you have to list all your property and all your debts.

Bankruptcy Myth 16: You Can't Afford To File Bankruptcy.

Most people think they can't afford to file bankruptcy because they can't afford their bills. When a person or couple decides to file bankruptcy, the money used to make payments on their bills is used to pay a bankruptcy attorney.  But, what about the "up front" money?  Answer: If you qualify, and lots of people do, you can get filed for "$0 MONEY-DOWN".  That's right..."$0 MONEY-DOWN".  No "up front" fees.  No "up front" costs. Call us and see if you qualify.
* Assumes no equity above exemptions, no disposable monthly income, and no non-filing co-signers, as those terms are defined under the U.S. Bankruptcy Code.

Additional Bankruptcy Myth Explanations:


1. Understanding the 16 Myths & the Harm Not Understanding them Cause.


2. Repercussions For Believing In Bankruptcy Myths


3. Bankruptcy Myths: Make Sure You Know The Truth



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