Bankruptcy can provide relief for people facing unmanageable debt. While it's a common process, some of the myths associated with it can make it feel daunting. However, with the help of a bankruptcy attorney, you can recover your finances with ease. Here's a closer look at the truths behind a few common misconceptions about the process. 

A Guide to Common Bankruptcy Myths

1. All Property Must Go

There are two bankruptcy options: Chapter 7 and Chapter 13. With the former, certain property may be sold to help cover the debts. Meanwhile, Chapter 13 utilizes a repayment plan and doesn't require any liquidation.

However, even if you opt for Chapter 7, some exemptions are available to protect property up to a certain value. For example, homeowners can exempt up to $35,000 in equity or $60,000 for those over 65 years old. A bankruptcy attorney can provide guidance on the best method available for your circumstances. 

2. It Affects Credit Permanently

The bankruptcy itself will show up on your credit report for only seven years for Chapter 13 or 10 years for Chapter 7.  Negative credit marks from your creditors exist for seven years even if you do not file bankrutpcy.  However, the scores aren't stationary and can improve even after a bankruptcy filing.

While a bankruptcy discharge may cause an immediate drop in points, it's usually only momentarily. In fact, scores often begin climbing soon after discharge since they're no longer impacted by late payments and collection accounts. 

3. Both Spouses Have to File 

There's no law that requires both halves of a couple to file. The decision is based on who owns the debt. If both individuals are on an account or loan but only one files, the lender can go after the other spouse. In such instances, it's usually better for the couple to file together. However, in situations where one partner has all or most of the debt, they can file alone, protecting their partner's credit report.

If you need help handling debt in Downtown Concord, NC, turn to Ferguson, Hayes, Hawkins & DeMay PLLC to find relief. The skilled bankruptcy attorneys understand the stress that debt causes on families, which is why they're committed to helping their clients get a fresh start. Learn more about the law office's debt relief solutions online, or book a case consultation by calling (704) 788-3211. Text LAWYER to (910) 830-0939 for special promo information.