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Bankruptcy Myths and Facts
- Myth: Calling a bankruptcy trustee is a last resort.
Fact: A trustee has many ways to help with your financial difficulties. Although you need to use a trustee to go bankrupt, a trustee can help you without using bankruptcy.
- Myth: Once I go bankrupt I will lose everything I own.
Fact: Most individuals lose little or nothing in bankruptcy. Federal and provincial laws let you keep necessary clothing, household furnishings, most RRSPs, a vehicle, and other assets. Contact us to learn about the rules in your province.
- Myth: Once I go bankrupt I will never get credit again.
Fact: There are many factors to consider; however, it's simply untrue to suggest you will never get credit again. When we meet with you we can discuss reestablishing your credit in more detail.
- Myth: Some bankruptcy trustees charge much higher fees than others.
Fact: Personal bankruptcy fees are set by the federal government, and don’t vary by firm size or location.
- Myth: Only people with severe financial problems should talk to a bankruptcy trustee.
Fact: A trustee is the only professional trained to assess your situation and provide advice on a full range of debt solutions. Call us for a free assessment.
- Myth: I've never missed a monthly payment, so I can't possibly have a debt problem.
Fact: Making only the minimum monthly payment to creditors is a sign you might be in over your head.
- Myth: Bankruptcy is the only solution to debt problems.
Fact: There are many other options available to you, depending on your income and resources. Bankruptcy may not be your only option, but a trustee is the only professional who can protect you from your creditors. Call us for a free assessment.
- Myth: I got myself into this financial mess. I have to fix it myself.
Fact: If you are in financial difficulties, we can help you fix things. Don't go it alone–it may be too much to tackle by yourself. Call us for a free assessment.
- Myth: My friends and neighbours will find out if I go bankrupt.
Fact: Chances are the only people who will know about your bankruptcy are your creditors.
- Myth: If I go bankrupt it won't erase my tax debt.
Fact: Income taxes, like most other debts, are usually erased in a bankruptcy.
- Myth: Bankruptcy will ruin my credit forever.
Fact: A bankruptcy notation will stay on your credit bureau record for a period of time. You can start rebuilding your credit rating as soon as you are discharged. For example, based on current lending practices, you may qualify for a mortgage in as little as two years following your discharge from bankruptcy.
- Myth: Going bankrupt is like admitting failure. It’s shirking responsibility.
Fact: Bankruptcy does not reflect on who you are as a person. It doesn't mean you've done something wrong. It can result from things beyond your control such as changes in employment or your personal life.
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