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Professor of Law, Certified by the United States Veterans Administration

Bankruptcy Myths and Misconceptions

People are often reluctant to file bankruptcy because they fear they will lose everything. They are often unaware that California law exempts many types of property and assets from the bankruptcy process, often allowing them to keep their houses, cars and other personal property. If you are considering bankruptcy, it is important to get the facts from an attorney who knows bankruptcy law thoroughly. This will allow you to make sound decisions about your future based on fact, not on myth.

Call a Los Angeles-area lawyer at the Leventhal Law Group, P.C. at 818-347-5800.

Common Misconceptions About Bankruptcy

At Leventhal Law Group, P.C., I use the free initial consultation to help individuals determine whether bankruptcy is right for them. I answer their questions and review the laws, rules and procedures that will apply in their case. I am able to address common bankruptcy misconceptions such as:

  • Bankruptcy is no longer an option because of bankruptcy reform. The bankruptcy laws changed, but individuals are still able to file either Chapter 7 or Chapter 13 bankruptcy. Which is available to you depends on your debt and income, as determined by the means test.
  • I will lose my house to foreclosure. This is usually not true, as California law exempts a certain amount of equity from the bankruptcy process.
  • I will lose my car to repossession. Probably not true, as California law exempts cars valued under a predetermined threshold. You may also be able to reaffirm (see Glossary) your debt and continue to make car payments.
  • I will never get a credit card again. Not true; credit card companies may charge you a higher interest rate or set a lower credit limit, but credit cards are readily available to persons who have filed bankruptcy.
  • I will never be able to buy a house. Whether or not you can get a mortgage depends on many factors. I can advise you about your options. Bottom line: even people who have filed bankruptcy can buy houses.
  • My husband does not want to file bankruptcy. I’m afraid that this will prevent me from doing so. This is not necessarily true. I will explain the law and discuss your options, based on your financial and family situation.

As an attorney focused on bankruptcy, I am able to address these and other myths and misconceptions. The vast majority of people find that these objections to bankruptcy do not apply to them.

 

Contact a Woodland Hills, California, Bankruptcy Lawyer

Call 818-347-5800 to schedule a free initial consultation with attorney Jonathan Leventhal. You will always speak with me, not a paralegal.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.