Knoxville Bankruptcy Attorney

Common Bankruptcy Myths

There are many common public misconceptions regarding bankruptcy. These are bankruptcy "myths" that we at Saffa Law Group, P.L.L.C, will be all too happy to dispel for you. Below are examples of such bankruptcy myths:

Myth:  Filing for bankruptcy is very difficult. 
Filing for bankruptcy is not difficult, though we highly recommend you enlist the assistance of a Knoxville bankruptcy lawyer to ensure the best possible outcome for your unique situation.

Myth:  Only unproductive, irresponsible people file for bankruptcy.
This is absolutely untrue. Life-altering experiences, such as the sudden loss of employment, a serious medical issue or illness, and family issues like divorce, are types of reasons most people end up filing for bankruptcy, and happen to hard-working people every day.  

Myth:  If I file for bankruptcy, everyone will know about it!
Public record does list bankruptcy; however, with the exception of being a well-known public figure, no one will seek this information. Only persons whom you choose to tell, or someone having access to the bankruptcy court system, will know. 

Myth:  Bankruptcy cannot rid me of back taxes.
Depending on the type and age of the tax you wish to address, it is possible to get rid of back taxes. For the greatest chance of success, you have to file all your returns and the taxes owed.

Myth:  Filing for bankruptcy is something I can only do once.
You can file for Chapter 7 bankruptcy once every 8 years. For a Chapter 13 court-approved debt repayment plan, you can file more often than that, but you cannot have more than one bankruptcy case going at the same time.

Myth:  If I charge up all my credit cards, then file for bankruptcy, I won't have to pay for anything I purchased.
This skewed philosophy leading directly to fraud charges. Bankruptcy trustees can identify fraud right away, and bankruptcy judges do not tolerate fraud. 

Myth:  If I file bankruptcy, I will lose everything I own.
In all actuality, bankruptcy can make it easier for you to keep what you own. When a person files for bankruptcy, they and their property are then protected from foreclosures, lawsuits, garnishments, and other collection attempts.

Myth:  I will lose the ability to own property due to bad credit from a bankruptcy.
You will get credit card offers and be extended credit shortly after the discharge of your bankruptcy. There are also creditors that will lend to you while you are in bankruptcy.