Arizona Bankruptcy: Myths and Misconceptions

Dispelling Myths about Bankruptcy

Myths about Bankruptcy abound, especially after 2005, when major reforms were made to the bankruptcy system. The new bankruptcy law brought new eligibility requirements and other complex changes.

At Vidrine Law Firm, PLC, we dispel the myths and misconceptions surrounding bankruptcy and explain the process to you in an up-front and understandable way. During your free initial consultation, we will look over your financial situation and come up with positive solutions to lift the burden of debt from your shoulders. Call us today at 502.885.1106.

Bankruptcy Fears and Myths

Many people have misgivings about filing for bankruptcy because of the mystery and myth behind it. Here are some common misconceptions:

• I won’t be able to qualify for bankruptcy because of complex new bankruptcy laws. This is a common misconception. Most people pass the means income test and easily qualify for Chapter 7 bankruptcy. If they do not, we will recommend a Chapter 13 filing, or other methods to help them regain financial stability.
• People who file for bankruptcy are financially irresponsible – This is false. Sixty percent of bankruptcy filings are due to insurmountable medical bills. A large majority of these debtors have health insurance but are forced into bankruptcy because of ridiculously high co-payments and deductibles.
• My FICO credit score after bankruptcy will be ruined – Not true. Filing for bankruptcy may lower your credit score, but so can delinquent bills. Filing for bankruptcy can give you a fresh start. If you are working you may qualify for a mortgage within 4 years of filing. Many credit card companies offer you credit because they know your debts are wiped clean after bankruptcy.
• I will lose all my property if I file for bankruptcy – This is a myth. Arizona has generous exemptions (up to $150,000) regarding your home, apartment or mobile home. Your car, furnishings and personal belongings are also exempt, up to an amount which is determined by state law. A lawyer from our firm can tell you if your assets may be used to repay creditors. In many cases, you don’t lose any assets whatsoever.

Making that All-Important Phone Call

You may have considered bankruptcy in the past, but were reluctant to pursue the idea. Fear of the unknown may have stopped you from making that first important phone call.

We are committed to helping our neighbors in the greater Tucson area become debt free. There is life after bankruptcy. Call 502.885.1106 today to find answers to your bankruptcy questions.