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4 Common Misconceptions about Bankruptcy

Posted by Revive Financial on Apr 13, 2016 12:00:00 AM

While many of us do attempt to save as much money as we can by budgeting and building funds, unfortunate circumstances do arise – sometimes without warning. This often results unavoidably in company bankruptcy or voluntary bankruptcy.

Whether you’re a business or individual, it’s important to seek bankruptcy advice in Australia. We’ve created this article to not only give you some pointers on how to file bankruptcy yourself, but to also show you how to deal with personal bankruptcies to make them as stress-free as possible.

Let’s begin by discussing the most common misconceptions about bankruptcy in Australia.

Misconception 1: You Will Lose Your Home if You Become Bankrupt

When you file bankruptcy yourself, it does not automatically indicate that you will lose your house. As long as the payments are made at the agreed time, properties are generally not seized by banks to cover the debt accumulated by bankruptcy.

On the other hand, if you do become bankrupt and cannot afford to pay your house repayments, in addition to other significant debts, creditors may contact your bank who could possibly take action.

Misconception 2: You Will Lose Your Job if You Become Bankrupt

Although employers or potential employers are able to access your credit report if necessary, bankruptcy is not grounds for the termination of your employment. In fact, it is considered unethical and discriminative if they do.

So if you’re thinking about filing for personal bankruptcy or company bankruptcy, don’t fear that you will lose your job (or your business) as this is not always the case.

Misconception 3: You Will Become Debt-Free After Declaring Bankruptcy

If you think that declaring bankruptcy yourself will clear each of your debts then you may need to think again. Even though it may remove most individual debts, chances are they will not clear the majority of common debts like HECS loans, tax repayments or debts resulting from instances of fraud.

If you aren’t sure about what debts to clear it is best to consult with a professional in the bankruptcy field.

Misconception 4: You Will No Longer Be Able to Get Credit After Filing for Bankruptcy

This is not always true, even though it may seem like it is an obvious fact. The best thing you can do is to rectify your credit score as soon as possible after declaring bankruptcy yourself, in order to bring your credit standing back to the green area.

Company’s and large banking or financial institution consider many factors when reviewing your application. If they see you have come out of debt and are working towards saving, they’re much likely to accept your application even in cases where you have filed for bankruptcy in the past.

If you’re trying to file for bankruptcy yourself and want to find out more about how you can make this process easy and straightforward, get your financial life revived by contacting Revive Financial on 1800 861 247. Seeking bankruptcy advice in Australia is just a phone call away.

Topics: Bankruptcy

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