4 Pillars of Victoria Sheds Light on Common Canadian Bankruptcy Myths

For those who are considering bankruptcy as a means of cleaning up their debt and credit, it can sometimes be difficult to separate the myths from the facts. This might mean that what you think of when you hear the word bankruptcy is far from what the reality is. With so many people holding misconceptions and having questions about this financial option, 4 Pillars of Victoria wanted to pull up a few of the most common myths and explain what the truth is.

Myth: Anyone Can File for Bankruptcy

The general conception about bankruptcy is that anyone can go through the process to clean up his or her credit. That’s not entirely accurate. There are many situations where bankruptcy can be a reasonable option, but it’s not for everyone. There are fees and costs associated with it, some of which can be quite high depending on your level of assets. In fact, for some people, it may be an expensive option. Bankruptcy is not an easy solution to remove debt by any means.

Myth: Every Debt is Included When Filing Bankruptcy

While many debts are included in a bankruptcy, it does not include all of them. For one thing, any secured debt such as a car loan or mortgage will not be included if you want to retain the assets. Also, many student loans are not included unless the person who took them out has been out of school for at least seven years. The reason this is required is so that the student loan program can continue to be available for those who need it. Any joint debts that are declared during bankruptcy will also impact the other person on the account.

Myth: Only the Poorest Individuals Go Bankrupt

This is also far from the truth. People of all different incomes choose to file bankruptcy from the poorest to those who have major incomes. The more someone earns, the more likely that person has debt, as surprising as this might seem. Bankruptcy is a legal process that can help anyone who is no longer able to meet their financial obligations.

These are some of the most common myths about bankruptcy debunked. There are others, but as you can see from these answers, you can’t believe everything you hear. If you need more information about bankruptcy, 4 Pillars in Victoria is here to help. You can learn more at 4pillarsdebtconsultants.ca