Bankruptcy Myths

financial relief Myth 1: Filing bankruptcy is difficult.

There are many rules in bankruptcy, the forms may seem daunting and the process may be confusing but these should not stop you from reaping the benefits of a fresh start. The Law Bankruptcy Law Firm of Clare Casas can represent you and guide you through the process in a straightforward manner.

Myth 2: My Credit Will be Ruined

If you are considering filing a bankruptcy petition, chances are that your credit has already taken a hit. It is possible, however, to begin rebuild your credit within months of filing bankruptcy. Initially, banks and credit card issuers may request additional money for down payments and your interest rates will be higher, but if you make your payments by the due date, your credit score will begin to improve.

Myth 3: All I own will be sold in a bankruptcy.

In Florida, there are exemptions granted by Florida Statute 222 and the Florida Constitution that protect your house, IRA's, retirement plans, household goods, furnishings, autos and other personal items. In Chapter 13, even if the value of your property is more than the exemptions protect, you can usually keep what you own by paying the trustee on the value of the non-exempt portion of the property.

Myth 4: My Friends and Family Will Find Out About My Bankruptcy.

Yes, it is true that a bankruptcy filing is a court record and public records (such as court filings) can be accessed by anyone. However, it's unlikely that anyone other than your creditors and those that you personally tell, will know. Unless someone has a specific reason to look up this information, it is not likely that anyone will find out.

Myth 5: I'm unemployed and my debts are uncollectible anyway.

In Florida, creditors have five years in which to sue you and they can collect against you for another 20 years if they obtain a judgment.

Myth 6: If I file, my employer will find out and I'll lose my job - or worse yet, I will not be able to get another job.

In the majority of cases, unless you choose to tell your employer that you filed bankruptcy, they will not find out. Even if they do find out, employers are not allowed to fire someone for filing bankruptcy.

Myth 7: You can only file bankruptcy once. IF you've already filed bankruptcy once before, there are rules regarding when you can file again, you do not automatically lose the eligibility to file a second time.

Myth 8: It is no longer beneficial to file bankruptcy under the new laws (BAPCPA).

Nothing could be further from the truth. Before the law changed in 2005, a debtor could choose which chapter of the bankruptcy code they filed under. Now, they must pass a means test in order to file a Chapter 7. The majority of debtors still qualify for a Chapter 7 bankruptcy. The chart below reports the Business and Non-Business Bankruptcy Filings both nationwide and in the state of Florida as reported by Administrative Office of the U.S. Courts:

All Bankruptcy Filings200820072006
Nationwide1,117,771850,912617,660
Florida67,64941,46225,700

There are many good reasons why over 1 million people nationwide and 67, 649 in the state of Florida availed themselves of the debt relief available under bankruptcy laws.

The Bankruptcy Law Firm of Clare Casas handles bankruptcy cases in Miami, Hollywood, Fort Lauderdale, Plantation, Pembroke Pines, Sunrise, Cooper City, Coconut Creek, Davie, Dania, Deerfield Beach, Hollywood, Hallandale, Inverrary, Lauderdale-By-The-Sea, Lauderdale Lakes, Lauderhill, Margate, Lighthouse Point, North Lauderdale, Miramar, Oakland Park, Pembroke Park, Tamarac, Weston, Wilton Manors, Pompano, Coral Springs, Boca Raton, Delray and South Florida.

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