5 Common Assumptions About Bankruptcy

Posted by debtfreebc on January 28th, 2021

You might have a few assumptions about how bankruptcy in Kamloops works. Indeed, many of us are not educated when it comes to this topic. Most of what we know about filing for bankruptcy is only from what we hear on TV whenever a company goes under and has to file for one.

This leads to quite a lot of misconceptions and assumptions circulating around such as the following:

Assumption #1: Your financial records will never bounce back after filing for bankruptcy.

It’s not the end for you. Bankruptcy will definitely damage your credit history but this isn’t permanent. If you sort out your finances after that, banks will more likely give you a new credit line. It takes time and you will have some more years to recover but it will happen. Many people have bounced back from declaring bankruptcy.

Assumption #2: It will take you 7 years before you can file for new credit.

While your record will stay for 7 years, it doesn’t mean you can’t get a new credit line. Some banks issue a new credit line to those who have filed for bankruptcy in the past. There are many lenient banks today that will look into your new spending habits, so it’s not impossible to get new credit.

Assumption #3: Bankruptcy in Kamloops is a quicker way of getting out of debt.

It’s not your get-out-of-debt-quick scheme. First, you need to prove that you have no capability to pay off the debt anymore. They will assess your case and determine whether to approve you of bankruptcy or not. If there are other solutions viable for you, those will be recommended. Treat bankruptcy as a last resort.

Assumption #4: Filing for bankruptcy in Kamloops will solve all your debt problems.

It’s not going to get rid of all your debts. The court will still decide what debts will qualify. You will still have to pay for your other financial liabilities such as child support and taxes.

Assumption #5: It’s an easy and simple process.

It’s like getting all of your financial records and laying them all out. That is already a complicated task. It will also go through a screening process and creditors will determine whether to approve the bankruptcy or not.

You also need the help of a licensed insolvency trustee such as Mike wright & Associates Inc. This professional will file your bankruptcy on your behalf. But before you do that, make sure you seek professional opinion and assistance as well. You should consult lawyers and look into other options like debt consolidation. You might still be able to get out of debt without filing for bankruptcy. But if this is the only option you have, the quicker you go through it, the better.

Shane Taylor is the author of this article. To know more about Debt consolidation in Kelowna please visit our website: debtfreebc.ca