3 Common Misconceptions About Bankruptcy

Talking of debt solution, several individuals feel that bankruptcy will be a life long anchor to carry with them throughout their financial life. This common misconception couldn’t be further from the truth.

People who are looking to address their debt at this level have been doing so for considerable amount of time. They have accepted that they are unable to meet their obligations without help. To this end, filing for bankruptcy can be a fresh start and a new financial beginning. But, here are some misconceptions that could hamper your decision.

1. Your credit is permanently damaged.

Declaring a bankruptcy will impact your credit score. But so will continually missing payments and falling behind on your existing debt. Bankruptcy is actually a chance to take a halt and start the process of rebuilding your financial future. Yes, it will take a minimum of 9 months before your bankruptcy can be discharged. You will not be able to borrow funds right away, given the total debt load you carried prior to bankruptcy. But with good consumer advice from your Licensed Insolvency Trustee, along with some disciplined budgeting practices, you can begin to build good credit again – and keep it that way.

2. You need to inform your employer about your bankruptcy.

In most situations, employers are not notified about a bankruptcy registered against their employee. For most Canadians, this means that they can continue to live and work without any effect on their career. For some, however, there will be a requirement to be bondable and insurable. These could preclude them from holding a specific position until their bankruptcy is discharged. Some professional establishments also need that they are notified of any bankruptcy filings. They may have their own policies against maintaining membership until a discharge has been acquired.

3. My spouse have to file for a bankruptcy as well.

You can generally only be asked to repay debts that are registered in your name, regardless of marital status. This means that as long as your debts are listed in your name alone, there will be no negative financial results for your partner and their credit rating. That said, if you have joint debts or your partner has guaranteed any of your debts, they will be on the hook to pay them off entirely. Your Licensed Insolvency Trustee will be sure to present to you any potential complications. This will help discern if declaring a bankruptcy is the right choice for you and your family.

Before filing for a bankruptcy, make sure to do your research. If you think that there is even a little chance that you can better your financial and credit situation without going down the bankruptcy lane, consider taking out a car loan. Canada Auto Experts can help you build your credit with a car loan and take care of your financial obligations with cash back along with your vehicle. Regardless of where you stand in your credit, we can help you improve your credit and financial situation with our hand-selected dealer partners. Call 1-855-550-5565 to speak with my credit specialist today!