"The couple has decided. It was determined that bankruptcy was the option that'll benefit them in the future. The past few weeks were filled with questions. So many of their friends had something to say about the procedure. But no one knew all the answers..."

So many myths, so much doubt. The average citizen of United States doesn't know much about it. Its no wonder bankruptcy is perceived as a way desperate people use to get out of debt. Sayings, handed down from generations, weave themselves in thinking men's mind. Let's take a closer look at the popular beliefs formed around the topic of bankruptcy:

1. Since they changed the laws, they eliminated bankruptcy - Truth be told, bankruptcy have changed between the OLD laws and the NEW laws. One major difference is you have to first pay for debt counseling before you file. But bankruptcy is still there once you passed this first step. Families earning higher incomes than what their respective state median dictate may not be able to file for Chapter 7. Furthermore, if they file for Chapter 13, they will have to pay more back over a longer period of time.

2. Filing for bankruptcy will cause me to have bad credit for ten years - Here is an eye-opener, just because something is on your credit report is negative means it will ‘tank' your credit standings. There're MANY cases where credit scores improves after filing. While it is a fact it will be reported in your credit history for ten years, it doesn't mean the effect will be overwhelming.

3. Since I'll file bankruptcy, I can max out all my credit cards - First of all, it's considered a felony charge if you're caught trying to ‘rack up' new purchases before filing. The Trustee in charge will review those purchases and will report it to the judge if he finds anything shady. Not a good thing to try if you value your freedom.

4. I can only file for bankruptcy once in my lifetime - You're not ineligible to file for bankruptcy again. Actually, you can file for Chapter 7 once EVERY SIX YEARS. Under Chapter 13, the bankruptcy code will allow someone in debt to file more than once.

5. Since I'm married, both of our credit will suffer -Not necessarily. If only one spouse have debt in their name only, then that person can file by himself or herself. This is especially common if two people become married and one has debt to get rid of.

6. Once I file for bankruptcy, they will sell off everything I own -While a Trustee can sell assets in the estate, he may not be able to sell ALL of them. It actually depends on what TYPE of bankruptcy is filed. Chapter 13 is normally considered a reorganizing way, so repaying debt is the priority. Under Chapter 7 however, the person filing usually get to KEEP many of his or her assets.

7. I'll have a clean slate once I file for bankruptcy -In a credit report, all debt is still reflected after filing. The date and case number remains on file for 7 - 10 years and will be labeled "account included in bankruptcy."

8. I won't have to worry about bills once I file for bankruptcy -Yes, you do have to keep current on the payments for you keep a car, home, motorcycle, boat, etc. If you don't, then be prepared for those items to eventually become repossessed.

9. My credit won't recover if I file for bankruptcy -If this was the case, then nobody would file, period! It wouldn't be something anyone would consider. The nation is built on credit and continues to depend on credit. You may have to apply for ‘secured' credit, but after you establish trust in repayment, oftentimes you'll be reinstated back for ‘unsecured' credit.

10. Everyone will find out I filed for Bankruptcy -Unless you're famous or the head of a major corporation, the only people who normally know about your filing are the creditors you owe money to. Bankruptcy is a very popular procedure so the number of people filing will be too great to publish.

Filing for bankruptcy doesn't have to be a procedure where you don't know what's going on. Even though there're new rules to it, it's still a way where you can climb back where you fell off. It's a way out for some who are drowning in debt. Bankruptcy doesn't have to be the ‘ugly duckling' on credit reports. Once you know what you're getting into, the process is easier than what people think. Check with your lawyer to make sure this is the right way to handle your finances before committing to a decision.