There is a stigma attached to filing for bankruptcy, and where there is a stigma, there is misinformation and confusion. You may have an interest in filing for bankruptcy as a means of debt relief but are unsure how it will affect you now and in the future.
We believe that it is important for you to make a filing decision on the basis of trustworthy information. In the interest of clearing up any misconceptions you might have, here are some important facts about bankruptcy.
You will not lose your job
You may have heard that if you file for bankruptcy, it will put your job in jeopardy. This is not true. There is a federal law that prevents your employer from firing you over bankruptcy.
Bankruptcy will not ruin you forever
It is true that filing for bankruptcy has a negative effect on your credit in the short term. However, it also indicates to creditors that you are willing to make an effort to resolve your debt issue. What you do after bankruptcy in terms of keeping up with payments and improving your credit is more important than the mere fact of filing.
Bankruptcy can stop foreclosures, garnishments and creditor harassment
An automatic stay goes into effect the moment you file for bankruptcy. This is a court action that prevents creditors from contacting you or taking any further collection actions against you while the stay remains in place. Keep in mind, however, that the stay is temporary and collection activities may continue once it is no longer in effect.