i have really bay credit. i dont know how much im in debt been in dept since i got a credit card at 18 & maxed it out & never paid it now i owe every1 $$$ from dentists & doctors gas & phone companies i even had a cell phone in my moms name. every time i say im going to file for bankruptcy every1 is like dont do that!!!! im now 23 & i cant get anything in my name because of mistakes i made when i was younger. im a single parent so i dont have alot of money. only people with real answers respond i dont want no smart remarks. please be detailed in ur answer all the info will be helpful thanx!!!!
2007-03-29 05:13:19 · 9 answers · asked by Anonymous in Business & Finance ➔ Credit
Well, I think the first thing you need to do is commit to yourself that you are going to change your spending behavior. If you have any credit cards left, rip them up! And if you get any "pre-approved" applications in the mail, throw them out.
Bankruptcy is certainly an option, but it is usually only for people with significant assets to protect -- such as property or a business. Otherwise you will just spend a lot of money on lawyers and court fees and not get any advantage. You still won't get credit and a bankruptcy on your record will follow you around much longer than poor credit when you were young. (You will need to disclose it on job applications, rental applications, mortgage applications, etc...)
A better option might be consumer credit counseling at a reputable agency. First, make sure that they are a non-profit agency focused on helping people like you and not a for-profit company making money off the fees they charge you. Second, you have to be commited to following the program. It is actually worse to start and fail because then they will kick you out of the program and you will lose even more credibility with the people you owe.
I know a few people who have gone the credit counseling route, stayed dedicated to it, and totally changed their situation. They will help you establish a reliable payment history, they will negotiate with your creditors, and get you on the path to financial health. One of our friends now owns a home, owns a car, makes a good living, and has a good credit rating because he stayed on the program. If he had filed for bankruptcy, I'm not sure he would of done so well.
Very best of luck to you. You can definitely change your situation if you have the willpower!!!
2007-03-29 05:30:30 · answer #1 · answered by jalanrosh 2 · 1⤊ 0⤋
First off all let me say I deal with credit on a daily basis as I am a mortgage broker. A Bankruptcy is a last resort for your financial troubles. There are various levels of bankruptcy. A Chapter 7 eliminates all of your debt but it also the toughest one to get approved for by the courts. The reason: the court is telling all of your debtors you no longer have to pay them back. A chapter 11 is a reorganization of debt. The court will put you into a payment plan based upon your ability to pay back the debts. Lately the courts have been forcing people into this because you do pay back the debtors but not at their demands.
As far as your credit report goes, it takes about 2 years to restore your credit - not 7 like someone mentioned earlier. The bankruptcy stays on your credit report for 10 years. Basically the various lenders treat you like a child after a bankruptcy, meaning: did you learn your lesson? If you reestablish credit (credit cards or small personal loans), your scores will rise quickly - however - if you fall behind again your scores will plummet just as quickly because the debtors see you really didn't learn anything.
At your age, and depending on just how bad your situation is, filing for bankruptcy may be a good way to go. Find a lawyer and see if it will make sense.
2007-03-29 05:34:50 · answer #2 · answered by thinking-guru 4 · 1⤊ 0⤋
I agree with the first poster. Bankruptcy should be a last resort. It completely destroys your credit. If you think things are rough now, they get a lot rougher in the wake of a Ch 7.
The bankruptcy will stay on your credit report for 10 years. You will be subjected to super-high interest rates on everything for a few years after you file.
Not only that, but if you ever want to have something in your name again, you have to reestablish credit. Basically, you have to show future lenders that you were able to get back on the horse and ride again. Bankruptcy is not a quick fix like many people think. It is a long process.
I hope that helps you - good luck!
2007-03-29 07:27:27 · answer #3 · answered by YSIC 7 · 0⤊ 0⤋
Bankruptcy may be the best action for you to make at this time.It will stay on your credit report for ten years, but you are going to have bad credit for that long anyway, because you can not pay them off in . if you do not own a home, file chapter 7, which wipes out all your debts. Chapter 13 is less expensive, but you will still have debt, less interest. call a bankruptcy lawyer and they will explain everything. You can not actually go to court unless you have paid the lawyer or he/she has agreed to payment term.
Do not let those that say it is a coward way out, it is not. The Government did not make this rule to help cowards, it was made to help those that have fallen on hard times and unable to pay the bills to get a fresh start. You can talk to a lawyer for free to advise you- make sure it is one that specialize in bankruptcy. The new law will probably not affect you.
2007-03-30 02:22:51 · answer #4 · answered by RY 5 · 0⤊ 0⤋
You, like many young people, don't see the danger in their spending habits when they don't have the money to pay for the things they need, or really want. I did the same when I was young. Bankruptcy to me is a cop out, it is for people who do not want to take responsibility for themselves, it also haunts you for the rest of your life (or what seems like it). If you really want to get your finances in order, first: communicate with all of your creditors and try to get interest rates down if you can but create a small monthly payment plan, even $10 a month they can not report negatively on your credit report, second: learn to live within your means, even if it means you can not have some things you want or able to buy your kids the stuff they want. So many companies target kids, that they HAVE to have these things to be happy, do not let your kids get sucked into that, if you give them love and the things they need (even used stuff) they WILL be happy.
2007-03-29 06:36:27 · answer #5 · answered by Hjkl 3 · 0⤊ 0⤋
It's a last resort measure. You get a "clean slate", but even if you file for bankruptcy you may still have to pay your debts back because of the new laws they have passed. Also, for the next 7 years after it would be nearly impossible to build any credit back up. My dad filed in the 80's and it took him almost 10 years to build his credit score up!
2007-03-29 05:19:45 · answer #6 · answered by Sara A 1 · 1⤊ 0⤋
Bankruptcy is a coward's way of getting out of something. YOU made the bills and if you have to pay each one $5 a week, you should pay them off. That's how LIFE works. You make it, you PAY it. Once you Pay what you owe people, your credit will get better.
2007-03-29 05:22:26 · answer #7 · answered by cArTeR 3 · 1⤊ 1⤋
EVERBODY makes mistakes; it's called being human. You might want to go to a free credit counsellor to work out a plan of financial and credit recovery. DON'T go to a for-profit agency; you'll just end up in worse shape than you're in now. Good luck!
2007-03-29 05:23:26 · answer #8 · answered by backinbowl 6 · 1⤊ 0⤋
It looks bad because that shows the lenders u cant pay your bills and it will be hard for u to get things..
2007-03-29 05:38:16 · answer #9 · answered by shorty21 5 · 1⤊ 1⤋