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Misconceptions About Bankruptcy | Parkman White, LLP
Birmingham bankruptcy lawyers advising you on complicated bankruptcy laws in Florence, Fort Payne, Fultondale, and all of Alabama
A person does not need to be flat broke to file for bankruptcy. In fact, many people have a steady income, yet still qualify for bankruptcy. The only “requirement” is that a debtor cannot pay bills when they become due. A “debtor” is an individual or entity that owes money when it cannot pay. Additionally, not all people who file for bankruptcy are financially irresponsible. There are many reasons to be unable to pay a debt that don’t result from financial irresponsibility. Many debtors have come across hardship, such as losing a job, serious illness, or divorce and are in a delicate financial state as a result.
An individual who has filed for bankruptcy can qualify for credit or purchase a home in the future; bankruptcy does not permanently ruin a person’s credit. Although bankruptcy stays on a credit report for a period of time, this is not permanent. Creditors and mortgage lenders may require more security for an individual who has filed for bankruptcy, but bankruptcy does not prevent an individual from obtaining a line of credit or a home mortgage in the future.
However, bankruptcy does not discharge all debts. There are certain types of non-dischargeable debts that a debtor will still be liable for despite filing for bankruptcy, such as student loans, alimony, and child support. However, some of these debts that cannot be discharged can be paid over time in accordance with a Chapter 13 plan.
Odds are, what you think you know about bankruptcy is not completely accurate. Let our Birmingham Bankruptcy experts clear up any misconceptions and guide you through the process of determining whether you are eligible for bankruptcy. Contact Parkman White, LLP today at 205-502-2000 for your consultation.