Bankruptcy Myths

mythsGiving Clients the Truth About Bankruptcy

If you are thinking about filing bankruptcy, you may have heard warnings about having to attend court or about not being able to rebuild credit. At the Bankruptcy Clinic, PC, we dispel bankruptcy myths and provide the truth about bankruptcy. We want you to be fully informed so that you can feel comfortable about your decision to improve your financial future.

Call us toll free at 888-522-6578 to schedule a free consultation. A skilled attorney will answer your questions and address your concerns about bankruptcy filing.

Common Bankruptcy Myths

Myth: Many People Can’t File for Bankruptcy Anymore.

Truth: Changes to the bankruptcy law in 2005 supposedly made it more difficult for some to file Chapter 7 bankruptcy. However, probably 95 percent of people who would have qualified for Chapter 7 bankruptcy prior to the laws going into effect still qualify today. For those who do not qualify, Chapter 13 bankruptcy is a good option that still provides significant debt relief for individuals. In fact, a significant percentage of our Chapter 13 clients pay less back to their creditors after the 2005 changes in the law than they would have paid back prior to its enactment.

Myth: People Lose Everything When They File Bankruptcy.

Truth: Two common questions debtors ask bankruptcy attorneys are: 1) Can I keep my car? and 2) Can I keep my house? At the Bankruptcy Clinic, PC, most of our clients keep all or virtually all of their assets, including their house and car, when filing bankruptcy. In a Chapter 7 bankruptcy, we use exemptions to help prevent losing some items such as furniture, jewelry, collections, retirement accounts and other valuable possessions. If our clients have a fair amount of property that we cannot completely protect using these exemptions, a Chapter 13 bankruptcy can reduce or eliminate many debts, while keeping the house, vehicles and other property.

Myth: The Newspaper Publishes the Names of Those Who File Bankruptcy.

Truth: Local newspapers generally do not publish the names of people who filed bankruptcy. In fact, most areas never publish any personal bankruptcy information.

Myth: You Will Have to Go to Court.

Truth: Most of our clients never have to go into a courtroom or in front of a judge. They will need to attend an administrative hearing with the bankruptcy trustee to briefly evaluate their situation or their debt relief plan, but a judge will only be involved if a problem occurs. If you choose the wrong bankruptcy lawyer, your likelihood of appearing in court may certainly increase.

Myth: Employers Discriminate Against People Who Have Filed Bankruptcy.

Truth: It is illegal for either private or governmental employers to discriminate against a person as to employment because that person has filed a Chapter 13 or Chapter 7 bankruptcy case.

Myth: Filing Bankruptcy Prevents Someone From Obtaining Credit.

Truth: A debtor’s ability to get a loan may actually improve after filing bankruptcy. Many creditors are willing to give people loans but cannot because of the amount of debts compared to income. Filing bankruptcy shows that the person is dealing with his or her financial problems and clears your debts so that there is an improved cash flow. In fact, the FHA regularly approves mortgage loans just two years following a bankruptcy filing. Paying back a new loan is an important step in rebuilding credit.

Myth: If You Pay a Collection Agency Even a Small Amount of Money, You Cannot Be Sued.

Truth: This is simply not true. Only by filing bankruptcy can someone stop all creditor harassment, lawsuits, foreclosure actions, and repossession and wage garnishment.

Myth: If You File Bankruptcy on a Hospital, You Will Be Denied Future Services.

Truth: By law, a hospital cannot discriminate against you for filing bankruptcy. You cannot be denied future services or treatment at that facility.

Free Consultation With a Bankruptcy Lawyer

For a free consultation with an attorney at the Bankruptcy Clinic, PC, call 888-522-6578 toll free or contact our bankruptcy law firm online. We have offices in Carbondale, Marion and Mt. Vernon, Illinois, to serve you. Evening and weekend appointments are available.

We are a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.


Phone: (618) 549-1100
Toll Free: (888) 522-6578
Fax: (618) 549-0141
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Map and Directions

Mailing Address:
Bankruptcy Clinic, PC
811 W. Main Street
Carbondale, IL 62901


Phone: (618) 993-1300
Toll Free: (888) 522-6578
Fax: (618) 993-0713
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Mailing Address:
Bankruptcy Clinic, PC
206 W. DeYoung Street
Marion, IL 62959


Phone: (618) 315-6600
Toll Free: (877) 621-2894
Fax: (618) 315-6603
Contact Us
Map and Directions

Mailing Address:
Bankruptcy Clinic, PC
2006 Broadway
Mt. Vernon, IL 62864