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Bankruptcy Myths Part #1
Myths and urban legends abound on the internet. It’s easy to take a picture and slap a factual claim on it. Maybe it’s a wrongly attributed quotation, or the claim of a conspiracy theorist. When I see one of these quotes or claims that just seem a little off, I turn to the urban legend debunkers at Snopes. Similar urban legends exist about bankruptcy and debt resolution. Whether it’s a claim by a debt settlement scam artist that President Obama was going to help you get out of debt, or the terrifying story of a man just down the street who filed bankruptcy and lost his house, his car and his dog, you need a resource to help you figure out truth from legend. As they say, every urban legend comes from a grain of truth, we’ll help you find that grain and ignore the rest.
Many People Believe That: Bankruptcy means they lose their home and car.
Actually, most people who file bankruptcy do in fact keep their homes and car(s). What you keep, what you give up is defined by either State or Federal law, depending on where you live. Here in Maryland, the law states that you can protect a certain amount of equity in your home if you own it alone, and potentially more if you own it in a certain type of joint ownership with a spouse.
This is not to say that you can keep your home if you cannot pay the mortgage payments as they become due. That’s a different myth altogether. No, what this means is that if you have some equity in your home, then you can probably file bankruptcy while protecting that equity from seizure by creditors. The same thing is true for your car(s). If you can afford the monthly payments, and your equity is within the exemption constraints, then you can usually keep them.
As with everything , exceptions apply and that is the core of this urban legend. It’s the maybe’s, probably’s, and conditions that breed the uncertainty. Manage your uncertainty. Find a knowledgeable law firm who will help you navigate your way through Urban Legends.
If you’re in the State of Maryland and need help separating the facts from the legends, call (410)929-0330 or contact us today for a FREE consultation with a Baltimore bankruptcy lawyer.