If you’re reading this blog then you’re probably thinking about whether bankruptcy can provide you with the debt relief you need. The answer is “yes,” but you might be worried about at what cost that relief comes. Many individuals find themselves concerned about their credit score and how their assets will be dealt with during the bankruptcy process, fearing that they will be left with nothing, although debt free, once everything is said and done.

This simply isn’t the case. To start, the law recognizes a number of bankruptcy exemptions that allow you to keep some of your assets. This way you’re not left without anything to start your life post-bankruptcy. Second, if there are assets that you really want to keep but are afraid that they will be sold off during a Chapter 7 bankruptcy, then you can consider reaffirming the debt.

Reaffirmation agreements essentially remove the asset from the bankruptcy process. This means that it won’t be liquidated, but the debt won’t be forgiven, either. Instead, you agree to pay back the debt in full. You might even be able to renegotiate the terms of the debt. Some people, though, find these agreements beneficial because they can keep prized or much needed assets post divorce while still obtaining debt relief by alleviating themselves of the obligation to repay other debts. This can help ensure that they stay up-to-date on, say, a mortgage or a car payment without risking foreclosure, repossession, or losing them through bankruptcy.

Reaffirming debt is a big decision to make, just as are other choices that have to be made throughout the bankruptcy process. In order to reach the fresh financial start you need and deserve, you need to understand the process and how to utilize it to your advantage. That might sound overwhelming, but the good news is that there are experienced attorneys who stand ready to help guide you through the process.