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People are exposed to a wide range of misinformation on the topic of bankruptcy. You may even have avoided considering bankruptcy as a debt relief option based on things you have heard. The truth is, bankruptcy can be the most effective way to help you get a fresh financial start. Do not allow misperceptions to get in the way of achieving lasting debt relief.

Myth: Bankruptcy is only for the lazy or people living beyond their means

People from all walks of life can suddenly find themselves in a financial hole. A medical emergency, the loss of a job, and other unexpected factors can cause people to fall behind on their bills. The fact is, most households do not have enough savings to help them get through a financial emergency.

Myth: You will lose everything if you file for bankruptcy

You will not lose all your possessions if you file for bankruptcy. However, a Chapter 13 filing will enable you to hold onto more assets than a Chapter 7 filing.

Chapter 13 will reorganize your debt, putting you on an affordable repayment plan that will last from three to five years. Because you are still making payments on some of your debt, you can keep numerous items. If it looks like Chapter 7 is the better option for your situation, you can still exempt certain things from the grasp of creditors.

Myth: Your credit score will be destroyed and will never recover

Filing for bankruptcy protection is going to damage your credit score. However, if you are already falling behind on your payments, your credit score is taking more and more damage every month. Bankruptcy allows you to stop the clock and start over.

Once you have your finances in order, you can request a debit card tied to your bank account. This will help you keep your spending within your means. Once you have had your debit card for a period, you can apply for a credit card. If you can keep up with your credit card payments, you will be amazed at how fast you can begin repairing your credit score.

Do not allow misinformation to keep you from getting relief from your debt

You do not have to be embarrassed by overwhelming debt. Relief is available. A skilled professional can help you explore your options.