alicia24 Posted October 25, 2005 Share Posted October 25, 2005 What should I expect Link to post Share on other sites
cosmogal Posted October 25, 2005 Share Posted October 25, 2005 I did that about two years ago! I had to...do to bad cicumstances I could not change at the time. I saw a lawyer about it and he said declaring bankruptcy was the best thing, so I did it. First of all, they only let you declaire it under certain conditions. If you don't own a new car, a house, property, or a business and you make under $50K, you can declaire it. Once you file, your lawyer handles the paperwork. Then you appear in court and they ask you a bunch of questions. They either grant it to you or they don't. If they do, a few months later, you receive paperwork in the mail stating your bankruptcy is official. After that, you have a clean slate. Declairing bankruptcy gives you a zero balance on your current credit record. It may or may not effect you getting a job. Some employers look at that as a red flag, but for the most part, they'd rather see bankruptcy then very bad credit since it shows you took care of the problem rather than being lazy and ignoring it. As far as getting a mortgage, some places will turn you down whereas others will charge you a high interest rate...same for a car. I know someone who just got a brand new SUV from a dealer and she had VERY BAD CREDIT, and still managed to get the car. So there is still hope, just high rates! My suggestion is to do it. It will stop harrassment and clear your slate. I'm glad I did it, at the time it was my only option. Good luck! Link to post Share on other sites
RainyDayWoman Posted October 25, 2005 Share Posted October 25, 2005 check your state's particular stipukations. from what i understand, bankruptcy here is a little different from what the last poster described, so it may also be different where you are. better yet, you have to have someone to help you through the counseling and the whole process....talk to them, they will obviously know the answers to your questions. Link to post Share on other sites
Mz. Pixie Posted October 25, 2005 Share Posted October 25, 2005 I did that about two years ago! I had to...do to bad cicumstances I could not change at the time. I saw a lawyer about it and he said declaring bankruptcy was the best thing, so I did it. First of all, they only let you declaire it under certain conditions. If you don't own a new car, a house, property, or a business and you make under $50K, you can declaire it. Once you file, your lawyer handles the paperwork. Then you appear in court and they ask you a bunch of questions. They either grant it to you or they don't. If they do, a few months later, you receive paperwork in the mail stating your bankruptcy is official. After that, you have a clean slate. Declairing bankruptcy gives you a zero balance on your current credit record. It may or may not effect you getting a job. Some employers look at that as a red flag, but for the most part, they'd rather see bankruptcy then very bad credit since it shows you took care of the problem rather than being lazy and ignoring it. As far as getting a mortgage, some places will turn you down whereas others will charge you a high interest rate...same for a car. I know someone who just got a brand new SUV from a dealer and she had VERY BAD CREDIT, and still managed to get the car. So there is still hope, just high rates! My suggestion is to do it. It will stop harrassment and clear your slate. I'm glad I did it, at the time it was my only option. Good luck! Actually, there are some misconceptions in this post. There are two types of bankruptcy- Chapter 13- where you make small payments on your debt and Chapter 7 where you either reaffirm (continue to pay) secured debts or you release the collateral. This would be in the case of a car or a home. Most credit card debts are unsecured and you can wipe those out completely. It is NOT a clean slate. Sure, you can forget about having to pay those debts back but there are several downsides to it. First of all, a bankruptcy stays on your credit rating for ten years. In some states a lender can use that against you for up to two years in purchasing a home. The bankruptcy laws have just been tightened up so at this point it's harder to declare bankruptcy that it was say, a month ago. Bankruptcy laws vary from state to state so what's allowed in one state may not be allowed in another. I worked in banking, and I learned alot about bankruptcy court and proceedings there. I also saw from a different level how frustrating it was to people to have to pay higher interest rates for things they needed to purchase on credit. There are few legitimate reasons for filing- death of a spouse, medical bills that are enormous and cannot be paid, injury or sickness resulting in an inability to work for an extended period of time or loss of employment. If you're a single college student who doesn't really have any interest in purchasing a home any time soon or anything substantial then I can see where it might work for you but I'd think carefully about it otherwise. There are other ways to prevent filing. You can try to work through a credit counseling agency first to see if you can settle your debts that way. It's a serious decision with long standing consequences and should be considered carefully at any rate. It shouldn't be used just as a program for someone to run up debts and just decide they don't want to pay it back and file- thus the tightening of the laws recently. Link to post Share on other sites
Shuana Posted October 25, 2005 Share Posted October 25, 2005 I filed chapter 7. Which cleaned out everything I had but my car note, because, well... I needed to have the car. It was reaffirmed with the bank that the note is out of. I am always on time with paying it, always have been but was told if I am late they have grounds to take it from me. It was the hardest thing I ever had to do. I had TOP credit ratings all my life. I was ALWAYS on time with all my bills. Then I started flipping my credit cards around for better interests. Took out 2 personal loans which I should have used to consolidate my credit cards (I had 30 of them) but I did not. The money went fast on ... I cannot tell you what. The only thing I got from being $50K in debt was an older truck that I payed for by a bank check. Otherwise, NOTHING. What to expect is, the lawyer will notify all your creditors. If you have a home it will be harder, you may even lose it. Go chapter 13 if that is the case. Unfort. the new law just passed where they may work with you and not allow all your debt to be squashed. So, look at the deeply too. The lawyer will set everything up for you, you will receive a court date in the mail. You will sit there in a room FULL of others declaring bankruptcy, you will be called up, they will ask for your SS number, or pay stub works., They will ask and want to see titles to any cars you own, mortgage stub too. They will ask you if you have anything you did not declare, they will ask you were you work, they will ask who you live with (thinking payment wise). Keep minimal $ in your checking accounts, if you have any saving close the account before hand, they will take it! All general about you type stuff. With your cars they WANT a Kelly Blue book value to them, MAKE SURE you have them (and all the other documents you need or they will call you back for another date, which sucks personally). With one of my older cars the KBB put a high book value on it, the Judge was cool because he thought it was booked way to high, which allowed me to keep it. They think you should only have 1 vehicle but if the value of the other is nill, they will let you keep it. Any "FUN" stuff you have such as quads, trailers, boats, snowmobiles you better put them in someone elses name because if they find out you have these type of recreational things they will take them from you and use it to pay off some of your debt. I was crushed and so dissapointed at myself for what I got myself into.. it is sad because if I was to get married I could not joint with my S/O because he has top, top credit and mine would destroy him... I have to say though .. a year later now that it truly was the best thing for me to do. I never think about it anymore, I have money in the bank and in savings, I will NEVER and I mean it, get another credit card AGAIN, I have learned and I like this life better now. No stress. If I want something I pay cash, if I don't have the money ... I just do not get it. You will be fine, don't worry... just get all necessary paperwork together, and just don't let it happen again. Remember ... Credit card apps will show up again, just do not use them at all... because you will get back into the same situation. Lots of people I know bankrupt and now they are back in the same hole again... Link to post Share on other sites
cosmogal Posted October 25, 2005 Share Posted October 25, 2005 ...yeah, credit counseling may be an option. However, your credit score still remains poor even if you win the lottery and pay off everything! That's what sux! Link to post Share on other sites
Skeered Posted October 25, 2005 Share Posted October 25, 2005 Ok I'm in the ending stages of my BK now...and man I tell you what I know the end result will be good but this waiting has been hard. Here in AZ not sure if it's a country wide deal but the Bankruptcy laws changed as of October 15th. They are now harder to obtain then in the past. There are two kinds of filing chapter 13 and 7 plus all the different ones for businesses and so forth. However with the new laws in place I would suggest contacting a lawyer and seeing what they feel you should do in your best interest. Most will give a free consultation and will be honest as far as if a BK is the right plan. Unfortunatly this is what's keeping me from my divorce and child support and other things and during the middle of my filing I got in a wreck that totalled my car that I had on the BK so I had to change my filing so mine has now taken almost a year to complete...but they usually aren't this challenging..talk to a professional and get all your answers..IMO Link to post Share on other sites
amerikajin Posted October 25, 2005 Share Posted October 25, 2005 I'm not entirely sure that it has gone into effect just yet, but I know that there have been major changes in bankruptcy laws enacted over the past year. It used to be you could just declare bankruptcy and get bailed out by Uncle Sam - not so easy anymore. Due to the new laws, you still must pay what you owe unless you can prove there is simply no realistic way you can pay it off anytime within the next (7?) years. And the way it is calculated, you'll still have an estimated amount that you're able to pay and you'll have a payment schedule set up, and you'll be expected to live by that schedule - or face lawsuit from the creditor. Think carefully about going into bankruptcy. Check with a CPA or a tax attorney first! Link to post Share on other sites
TooStress Posted November 3, 2005 Share Posted November 3, 2005 Can i sell my house and keep the money before I file for bankrupcy? Link to post Share on other sites
amerikajin Posted November 3, 2005 Share Posted November 3, 2005 I doubt it. To the best of my knowledge, a judge will demand that you disclose all of your assets. A court will likely look at your financial records covering a fairly lengthy period to determine what assets you may have. If you've sold property recently, I would guess that'll show up somewhere, and it is not advisable to attempt to conceal that from a court if they ask for those records; you could be charged with perjury if you try to distort your financial picture. If you sell a home, a judge is going to want to know where that money is. Furthermore, you may find out that a creditor has already placed a lien on your property. Link to post Share on other sites
Skeered Posted November 3, 2005 Share Posted November 3, 2005 Woohoo got great news on my Bankruptcy on Tuesday...it's been discharged meaning I"M DONEEEEEEEEEEE...it's only taken a YEAR!! UGH and a long dang year it's been too..now I can file for divorce and start getting child support...life is good life issssssssssssss good.. As far as selling your house and keeping the money...my suggestion would be keep it until you finish filing and then sell..because if you sell now and then file they will want that money...I got in an accident during mine and I was paying a trustee payments to keep the vehicle that was totaled...they almost didn't give me the money from the accident and then I would have been paying on a car I no longer own, have no credit and no money to get another car...so I switched my chapter I was filing and got the injury money and bought a new car... Talk to a lawyer and get their advice on how you should handle your affairs..but yes in most states the new Laws are in effect now if not in all states because it changed October 15th. And now BK's are much harder to obtain and much harder to keep anything in the end... Link to post Share on other sites
TooStress Posted November 6, 2005 Share Posted November 6, 2005 There is noway i can go to jail for not having money to pay back my debts right? My husband and I both lost our job so our children are paying for the house and our bills at home. My oldest son is working full time and my daughter is working full time and going to college full time. Can the creditors make my children pay back our me and my husband's bills? Link to post Share on other sites
Skeered Posted November 7, 2005 Share Posted November 7, 2005 You won't go to jail, no. And noone can force you to pay your children back for paying your bills but I would hope you would want to anyway. Your bills are being paid and that's what the creditors want they don't care who does it just that it is being done. Are you and your husband looking for work to take the burden off your kids? Link to post Share on other sites
TooStress Posted November 9, 2005 Share Posted November 9, 2005 Yes we are looking for jobs but it is so hard to find them these days. At least it is hard to find a full time job. My children are helping us with the bills. I just dont want the creditors to make my children pay since they been paying for our bills. Thank you for your help Link to post Share on other sites
933KJL Posted November 9, 2005 Share Posted November 9, 2005 Overextending yourself is not a crime and the worst that can happen is to take you to court and get a judgement. If you do not pay, they can garnish your pay, take money from your bank account, put a lien on your house, reposess your car if you owe a car payment, etc. They cannot toss you in jail ever. As for your kids being responsible, they are not responsible UNLESS they have co-signed any obligations. If they are paying, they are being great kids--make sure to thank them. You may want to look at this site http://www.budhibbs.com he is a Texas attorney (?) who specializes in dealing with debt collectors and has a lot of great tips on how to deal with it. He has a program that he tries to sell as well, but there is some pretty good free advice on the site. His LAST recommendation is to file bankruptcy--he said it is better to just let them hound you. Link to post Share on other sites
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