Whether you have recently filed for bankruptcy in Oregon or are merely considering it, there are several myths out there that are simply not true. Here are the three most common ones and the truths behind them!
If I file bankruptcy, I will lose my home!
The only way you could lose your home in bankruptcy is if there was too much excess equity over and above what your homestead exemption would cover. If you are behind on your home payments, the bank is in a position to where they could foreclose on your home, but they would have to do this outside of the bankruptcy. In fact, the bankruptcy would protect you from foreclosure at least for a limited amount of time. This would buy you additional time to work out a loan modification or additional time to stay in your home without paying the mortgage.
I will lose my car if I file for bankruptcy!
It is highly unlikely that you would lose your car after filing bankruptcy, unless again it had excess equity over and above any applicable exemptions. Most vehicles are exempt. For those who are financing a vehicle, if you are current on the payments then you can choose to keep the vehicle regardless of what the creditor would like. However, the creditor will want you to sign a reaffirmation agreement that re-obligates you to the loan. To ensure that you can keep the car, you have to attempt the reaffirmation agreement process by signing the document. As long as you do this, while being current on your payments, the creditor cannot take your vehicle.
I’ll never be able to get a credit card again!
This couldn’t be further from the truth. Credit card companies will often extend credit to you right after your bankruptcy is filed, but you should be careful about their high interest rates and possible annual fees. It is also important not to become overburdened with credit card debt. If you can avoid paying interest it is helpful to do so.