The most important thing I wanted to tackle by writing this article was the stigma people attach to bankruptcy without much, if any, real knowledge of the process. From my experience, this stigma doesn’t appear to be as prevalent with alternative debt solutions.

Would your perception of a fellow individual going through a debt management process, for instance, be different from knowing they were filing for bankruptcy? How about your perception of a friend?

Though I am in complete agreement with the importance of considering all options, rather than simply advocating bankruptcy as a one-fit solution.

(For further reading on point two, I found this Wikipedia page useful: http://en.wikipedia.org/wiki/Bankruptcy_Abuse_Prevention_and_Consumer_Protection_Act)

Certain states, like Florida, are known for their homestead exemptions, whereby people can exempt certain property from their bankruptcy estate.

Personal bankruptcy should be your last resort.

It’s possible that bankruptcy might fall under the same protection.

I think #3 is by far the biggest misconception.

Also, people think they have leverage when they say they “will file bankruptcy” when trying to work with the bank on settlements. In the end your only hurting yourself.

As for #4, I had a family member claim bankruptcy several years ago. She said she had never seen so many offers for credit cards as she did once the bankruptcy was final. I wonder if this would still be true in todays banking crisis?

Some may worry that this will isolate them from their friends who can continue to live that lifestyle.

Not that this should really be the reason to stay out of bankruptcy.

California, for instance, is an at-will employment state so you can be fired at any time, for almost any reason. Or no reason at all!

If employers couldn’t use your credit check as a reason to disqualify you for employment, I’m not sure why they would even check.

John DeFlumeri Jr