Sometimes the reason why you think you can't do something is from not
knowing enough information in the first place.
Bankruptcy is one of those things for a lot of people. There are times people may
give up on their finances when the solution to their problem is right
in front of them. It is just a matter of getting clarification from a
The following reasons are a few common excuses as to why some don't
file for protection they may actually qualify for:
"I make too much money to qualify and I'll have to repay everything
I owe." This may not be the case. Some people think that if they
make too much money they won't qualify for debt discharge. The means
test can help determine eligibility for Chapter 7 or Chapter 13 bankruptcy.
You may qualify for a reduction in what you've been paying with a
court-approved repayment plan.
"I have back incomes taxes so I know I can't file." Limited
circumstances may allow you discharge old tax debt under
Chapter 7. Yet, you may be able to reduce what you owe if you file
"Filing for protection may cause me to lose my home." Many debtors
who file bankruptcy get to keep their home thanks to the homestead exemption
part of the bankruptcy code. Even equity in your home may qualify for
protection. If you are facing foreclosure or your mortgage is underwater,
you may want to review how bankruptcy can help.
"I'll lose everything I own if I file." Think about some
of the biggest corporations that filed for bankruptcy, and still managed
to retain a large portion of their assets. Yet, the filing process is
strategic and you need to have the right knowledge to understand how to
go about the process. This means you should take time to discuss your
concerns and questions with an experienced bankruptcy expert to learn
how the process can protect your assets legally.
"I have too much debt!" There is no limit in how much debt you
can have in Chapter 7 or Chapter 13.