Myth #1:The filing of a bankruptcy will eliminate your credit for 10 years. This is not true. The bankruptcy filing will remain on your credit report for up to 10 years. This does not mean it will have a negative effect on your credit during that 10 year period. If you engage in a credit rebuilding plan you may be able to re-establish your credit in between 12 and 18 months. You should speak to a bankruptcy attorney about how to rebuild your credit.
Myth #2: You lose all of your assets in bankruptcy. This is not true. Individuals often believe that they will lose all of their assets when they file bankruptcy. In the State of New York you can utilize either New York State exemptions for Federal Exemptions to exempt various assets that you have. Exemptions are commonly used in Chapter 7 bankruptcies by individuals. Chapter 13 bankruptcies usually do not involve the loss of assets.
Myth#3: Husbands and wives must file bankruptcies at the same time. This is false. Individuals who are married are not required to have both the husband and the wife file bankruptcy at the same time. Although the parties can file a joint bankruptcy, they can also file individual bankruptcies, should they desire to do so, or only one of them can file bankruptcy.
Elliot S. Schlissel, Esq. has been practicing bankruptcy law for over 35 years. He is the managing partner of Schlissel DeCorpo LLP. The law firm represents debtors in foreclosure defense and helps debtors file bankruptcy cases and obtain mortgage modifications. They can be reached for a free consultation at 800-344-6431 or by e-mail at Elliot@sdnylaw.com.