Bankruptcy Myths

Dispelling Myths & Misinformation About Bankruptcy 

Many people believe that bankruptcy is an option that can only come about through extreme negligence and irresponsibility with your financial assets. This is just one of many myths regarding bankruptcy that we can hopefully help clear up. At Buchalter & Pelphrey Attorneys At Law, we work hard to help our clients get a fresh start and set themselves on the path to financial freedom.

Get help from our skilled team today by calling (321) 320-6088 for a free case evaluation!

Common Bankruptcy Myths

Bankruptcy is the Result of Irresponsibility 
Bankruptcy laws were created in the first place to allow good people who had gotten in over their heads to restore their life and financial freedom. In many cases, insurmountable debt arises purely bad luck or a catastrophic event, such as a serious injury, major accident, or financial collapse. This can cause people to fall behind on their mortgage payments or credit cards, resulting in them needing to find a way out.

Bankruptcy Ruins Credit 
While a bankruptcy does appear on your credit score for a considerable amount of time (7 years), odds are your credit score is already pretty low and filing for bankruptcy really doesn’t add much damage. In fact, in rare cases, filling for bankruptcy can start improving your credit almost immediately. Not to mention bankruptcy helps alleviate debt by giving you the opportunity to start over with a blank slate.

You Cannot Get a Loan after Filing for Bankruptcy 
Most individuals can take out a home loan as early as two years after filing. In fact, if you start saving for a down payment on a home right after declaring bankruptcy, you may be able to get a loan by the time you have reached your down payment goal!

Bankruptcy Discharges All Debts 
Unfortunately, this isn’t usually possible. Student loans are not usually forgivable by bankruptcy except in special circumstances. You may also be able to pursue tax relief through bankruptcy, but it is not usually absolved in this way. However, by freeing yourself from other debts, your tax or student debt may be easier to manage after bankruptcy by having additional money freed up.

Anyone can File for Bankruptcy 
You must meet the eligibility requirements before you can declare bankruptcy. In order to file for Chapter 7, you must be able to pass the means test. For Chapter 13, you need to have a certain amount of disposable income in order to reorganize your debt. If you do not qualify, however, there are bankruptcy alternatives, such as debt counseling or loan modifications that may be able to assist you.

Have questions about filing for bankruptcy? Contact Buchalter & Pelphrey today!


  • “Their expertise and experience is unmatched!” - Ron
  • “The BEST” - A.B
  • “You could not put yourself in more competent hands at any price.” - Joyce A.


    Begin Moving Forward Today

    • Please enter your first name.
    • Please enter your last name.
    • Please enter your phone number.
      This isn't a valid phone number.
    • Please enter your email address.
      This isn't a valid email address.
    • Please make a selection.
    • Please enter a message.
    • By submitting, you agree to be contacted about your request & other information using automated technology. Message frequency varies. Msg & data rates may apply. Text STOP to cancel. Acceptable Use Policy