“I’ll lose everything I have!” This is the misconception that keeps people who really should file for bankruptcy from doing it. In fact, bankruptcy can help you hold on to your property. Many people have this misconception and wait to explore the bankruptcy possibility until they’ve already lost important property. There is a common myth many believe about bankruptcy that the government will sell everything they have and they’ll have to start over from scratch. Not so.
Every state has exemptions that protect certain kinds of assets, such as your house, your car, money in qualified retirement plans, household items, heirlooms, guns, and clothing. Most people pass through a bankruptcy case and keep everything they have. If you have a mortgage or a car loan, you can keep those as long as you keep making the payments (like the rest of us).