Military families face many more challenges and concerns than the average family. They are worried about the military member’s safety and ability to return home. In many marriages, one spouse handles the finances, but in military families, what do you do if the person who usually handles them is deployed? Young newlyweds may have little time to prepare or put a financial plan in action before the military member is deployed. If a military family is considering bankruptcy as a way to ease the financial burden, they may be confused because of all the fake military bankruptcy myths out there.
One of the biggest concerns military families have is being able to communicate with each other after deployment. Having accurate information is crucial, especially if the family is considering filing for military bankruptcy. A knowledgeable military bankruptcy lawyer can explain the family’s options and dispel some of the most common bankruptcy myths, including:
I Will Lose My Security Clearance
A major concern that many military members have about bankruptcy is that they will lose their security clearance. However, in many cases, there is no threat to a member’s security clearance. In fact, filing bankruptcy may actually help you keep your security clearance since it shows you are taking a proactive step to resolve your debt problems.
You Will Have to Pass the Means Test
In 2005, Congress added a “means test” in the Bankruptcy Code to help determine whether a debtor qualifies to file chapter 7. Basically, if your income is below the median income for your zip code, you qualify to file chapter 7 bankruptcy in Texas and wipe out most of your debt. If your income is above the median, you may not qualify for chapter 7, and this firm will recommend non-bankruptcy remedies to address your debts.
However, disabled veterans are nearly always exempt from having to use the means test.
I Will Lose All My Property
Another common concern many people have is that they will lose all their property if they file for bankruptcy. However, this is usually not the case. The Texas and federal laws allow most debtors to keep all of their assets. In fact, the American Bankruptcy Institute reports that approximately 96 percent of chapter 7 bankruptcy cases are “no-asset” cases, meaning that all assets were retained by debtors.
Some people mistakenly view bankruptcy as a lose-everything proposition. However, this cannot be further from the truth. Bankruptcy protection allows many people to keep their property while starting anew. There are programs in place that can help you keep your home while bringing you current with any payments that are behind, such as home loan modifications, which are much better alternatives than filing a chapter 13 case.
Bankruptcy Won’t Cover Medical Debt
Medical bills are often wiped out in bankruptcy, despite the longstanding myth that medical debt is not covered in bankruptcy. Most people who file bankruptcy, military and civilian alike, have medical debt. Bankruptcy does not restrict you from discharging medical debt, credit card debt, personal loans, and more.
Contact Erin B. Shank Today for More Information
Erin B. Shank wants you to have accurate information so that you can make informed decisions about how to deal with your debt. Once you have the necessary facts, you will be empowered and can move forward by making the best decisions for yourself and your family. Your decision to protect our country and choose a military career should not bar you from exercising the same rights as other Americans have. An experienced bankruptcy lawyer can help guide you and your family through this process so that you can better protect your family’s future. Contact Erin B. Shank, Attorney at Law today to learn more about your options for filing bankruptcy in Texas and the protections it can provide.