Bankruptcy is a tool used to help consumers manage debt they can no longer afford. Unfortunately, misinformation and stigma surrounding bankruptcy cause many individuals to avoid filing at all costs, even if they would benefit from doing so.

Evaluate your options fairly by learning the truth behind these six common myths about bankruptcy.

  1. I will lose my car, my home and my retirement account

Filing for bankruptcy does not mean losing everything you own. With Chapter 13 bankruptcy, you can declare certain property exempt, including your home, your vehicle and other assets. If you have a car loan or mortgage, you can make arrangements to continue paying those debts.

  1. Bankruptcy means I have failed

Many people avoid filing bankruptcy because they worry they will look like a failure to friends, family members and business associates. Not only is bankruptcy quite common, however, it is usually rooted in factors beyond your control. Most people who file bankruptcy first experience a job loss, medical emergency or divorce that damages their finances beyond repair.

  1. If I file, my spouse also has to file

You can file bankruptcy separately from your spouse. This strategy works well when one person has a lot of debt in his or her name only.

  1. Bankruptcy stays on my credit report for 10 years

Most people file Chapter 13 bankruptcy, which remains on one’s credit report for seven years. The sooner negative items fall off your report, the higher your score will be after bankruptcy.

  1. Bankruptcy wipes out all debts

Although bankruptcy discharges many types of debt, including credit card debt and medical bills, other types remain. Bankruptcy does not discharge student loan debt, child support or spousal support. Most tax debt also remains after bankruptcy. If you keep your home, you will also keep paying your mortgage.

  1. I can eventually repay my debt without bankruptcy

Rising interest rates and fees make it difficult to repay debt once you get behind. If your debt is more than 50% of your month income, you are unlikely to pay it off within five years.

Your specific financial situation determines whether bankruptcy is the right choice for you. Many find they are able to move forward and achieve their monetary goals after filing.