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Bankruptcy Facts for When You Are on the Fence

Empty pockets
Bankruptcy can seem like a scary thought for many people who have done some research on what bankruptcy does. Chances are you have heard different stories from those who have gone through the process with variable outcomes. Although independent research can help you get a basic understanding of bankruptcy, know some basic facts to decide if bankruptcy is right for you.
Bankruptcy Does Not Ruin Credit
One of the most common reasons people are on the fence about bankruptcy is because they fear their credit will be ruined afterward. You need to remember, however, if you are in such a difficult predicament financially you are considering bankruptcy, your credit is already not ideal.
Your credit will take a hit after you file for bankruptcy for a certain number of years. However, the time period after you file provides the perfect opportunity to rebuild your credit. You will essentially have a clean slate to work with, which means you can recover from your bankruptcy as long as you remain vigilant.
Property Will Not All Be Lost
Another fear for those who consider bankruptcy is the loss of property during the process. Do not just assume you will lose your home or other major assets. Although you can expect to give up some personal property, you do have some exemptions. Exemptions allow you to keep certain assets which you will continue to pay for.
Many people will file an exemption for their home, car, or sentimental items of high value like jewelry. Should you have some items you want to keep after bankruptcy, let your attorney know as soon as possible to get those exemptions filed.
Both Spouses Do Not Have to File Bankruptcy
People often believe that if you are married, both spouses have to file for bankruptcy. This is not true. You can opt to file bankruptcy as an individual if the bulk of the debt is in your name only. If your spouse has good credit and does not have any debt you both own jointly, it is a good idea to leave his or her name off the filing.
However, if the debt is in both your names, you might be better off filing together. The process is much easier and smoother if you file together as opposed to filing separately.
Creditors Will Not Harass You
Many people who consider bankruptcy worry about the constant calls from collections and creditors. If you are in the position of filing for bankruptcy, you are no doubt used to those frustrating calls at all hours of the day. However, once you file for bankruptcy, the creditors are to stop calling you.
An automatic stay will go into effect once you file for bankruptcy. What this means is creditors may not contact you for the purpose of debt collection. An automatic stay is in place to protect you from harassment in the form of calls, letters, or emails. If a creditor continues to contact you after bankruptcy and there is no legal approval otherwise, the creditor is in violation of the law.
After you file for bankruptcy, you will notice significantly less collection calls right away. However, some may continue to call because they may not have gotten your bankruptcy filing into their system. If this happens, explain you have filed for bankruptcy and that they need to stop calling you.
While some creditors will adhere to the law, others will disregard it and call you anyway. You need to take some action with your attorney if this happens to you. Your attorney will contact the creditor or collection agent with a cease and desist order to stop contacting you.
If you need assistance with your bankruptcy, or if you have not yet made a decision to move forward, please contact The Madden Law Firm for help.

    The Madden Law Firm
    515 Rock St.
    Little Rock, AR 72202

    Phone: 501-378-7700
    Toll Free: 800-535-0001
    Conway Office
    (by appointment only)
    1027 Front St., Ste. 2
    Conway, AR 72032

    Phone: 501-764-4600
    Hot Springs Office
    (by appointment only)
    118 Second St., Suite M
    Hot Springs, AR 71901

    Phone: 501-623-6500
    West Memphis Office
    (by appointment only)
    Mid Continent Building, Suite 304
    West Memphis, AR 72301

    Phone: 870-733-1300
    Pine Bluff Office
    (by appointment only)
    415 W Sixth Ave.
    Pine Bluff, AR 71601

    Phone: 870-247-4200

    Disclaimer: This is a debt relief agency.