Score currently crap (601equifax, 595 experian, and 549 trans)?

Question

My score was 750 until my spouse lost his good paying job, and couldnt get equivelant pay so our income drastically dropped. We continued to pay good on house and cars, and tried to make cc payments. had to skip payment on one because min was too high, so under universal default the others raised interest and min payment none of these scum bag collectors want to work out a payment plan they want all or nothing and one harrasses me daily for my personal banking info, which I wont give. Question is if I file chapter 7 how much worse will the score posasibly get, I opened 2 small cc to try to rebuild and have been good with them, also would not include them in BK will have 0 balance and hope they let me keep so that I can start the re build process. Its humiliating to do a BK but I feel like it is truly the last resort, I have very little equity in the house thanks to previous refi with cash out to pay for other cc that husband brought to table. what to do I feel like crap!

Answer 1

bdancer is correct.

I used Consumer Credit Counseling Services several years ago and they worked with my creditors to lower both my monthly payment and interest rate.

You can call them at 1-800-388-2227.

Answer 2

First of all, there is nothing humiliating about a BK. The fact is; bad things can happen to good people. And a BK is not forever. Experian and Equifax will report it for 10 years, and Trans Union for 7. That is why you often hear that your credit is ruined for 7-10 years after a BK. However, that isn't exactly true, and you can recover your credit score from a BK in 2-3 years if you manage your credit responsibly after a BK, and dispute negative information on your credit report. (See section 611 of the Fair Credit Reporting Act).

You will have to "qualify" for a chapter 7 by passing the means test. The means test and guidelines are on the IRS website. In the event you don't pass the means test, you will have to do a chapter 13. But don't be to concerned; research shows that 96% of those who apply for a 7, pass the means test.

It's hard to say how much your credit score will drop, but I have personally seen credit scores drop 100 points with a BK; it really depends on how much debt your BKing, and how the credit agencies will calculate that into your score.

If you're trying to work out a payment plan, it sounds like you maybe able to handle your bills; at least if they were reduced a bit. I would suggest contacting a consumer credit counceling agency to avoid BKing if you can, as they will be able to get a payment plan for you with reduced payments. Unfortunately, it is rare for a credit agency to work out a payment plan without the use of a credit counceling agency. If you work out a plan this way, tell your creditors you want (in writing) an agreement that they will contact the credit reporting agencies to have them remove the late payments they have posted to your accounts. If they wont do it, tell them your going to BK, and they'll probably have a change of heart.

Also, you stated that you do have a little bit of equity in your home; leave it there. Don't touch it for paying bills.

Answer 3

The rules have changed. You cannot decide which cards you will include in the bk, because if they have balances on them, you need to pay. Under universal default, their interest rates will go up, maybe. The current bk rules determine how much you can pay within the next 6 years (I think). If you do a bk, the (601 equifax, 595 experian, and 549 trans) will look like the top of the mountain. I did a bk 8 years ago under the old rules, and I needed to survive and take care of 2 kids of my own (divorce did me in too). If you do the bk, you might be forced to sell the house unless you already have. If you have a late model car, you might be able to keep it, but if it is within the last few years, you will be looking for another car, as they will take that too. Look to borrow against IRA, 401K, Roth IRA, get a second on the house if you still have it.

Go to your church or synagogue. Try to avoid the bk.

Answer 4

nothing else is a better teacher than experience, please consider these items if you feel that filing BK is the best thing for you and your husband, ( I am assuming you are still together) when you file a bankruptsy, you and your lawyer go in front of the Judge, he determines what you will pay back and what you will not, base on the paperwork your attorney has submitted with your anwsers to certain questions, For example: do you go out to eat, take your clothes to the cleaners, get your car wash, give to any chariable organzations, if so how much. The judge will determined what you won't spend money on anymore so you can pay your creditors. Don't forget, their is also a trustee who must be paid, and if you are looking for a refund at the end of year, guess what? You will not get it, the IRS will send it to the trustee, and he makes the decision what to do with it. Mind you, we did not have credit card debt, only house and two cars, but my husband's pay was cut also. It gave us the chance to catch up without our home and transportation being taken, This was a chapter 13, we wanted to pay who we owed back, the court, irs, trustee, creditors, all treat you so much better when you want to pay who you owe back. When we caught up with house payments, and autos, we requested a dismissal, after several years we were able to get it removed from our credit, we now have two mortgages and several vehicles, but we are pretty well off now. See what paying back what you owe will do.

Answer 5

there not much of a difference between the two. If some one was looking into your credit history say for you to get a loan, these two will usually come up. There is a 3rd one as, sometimes called transatlantic they use as well. Most of the time each one will have a different credit score, mostly pretty close yet not the same. They use these 3 to deterime what your score should be. If one has you at 650 and another has 625 and the last one at 675 they get an idea of how your are as a client to their loans.

Answer 6

You need to see a bankruptcy attorney to detemine if you are eligible to file bankruptcy. You may have to do Chapter 13, which is the repayment option.

You cannot exclude those two small credit cards from the bankruptcy. Even if you have a 0 balance, the minute the bankruptcy hits your credit report, those cards will also go to the default rate and they may even close the accounts.

You should check with Consumer Credit Counseling Services (CCCS) to see if they can help put you on a budget to deal with these past due credit cards. Here's a link: http://www.nfcc.org/

Answer 7

why are you considering bankruptcy just because you are behind in credit cards?? Have you consider selling your house and downgrading to a smaller one or an apartment to pay off the debt, or if possible selling one or both cars? It doesn't sound like bankruptcy is your next option. How about getting a second job to pay the debt off? Your score will get a lot worse if you file bankruptcy and you won't be able to get anything on credit for about two years. It sounds like you have many other options.

Answer 8

first dont let anyone on hear lecture you, because ive asked similar questions about credit and i got nothing but lectures and solicitations. bankruptcy is definitely the last resort should you need to do it though dont fret. you will be unable to get credit cards and good interest rates on anything, BUT i had a friend do it and its only 8 years later and he got a mortgage well over 350,000 at a decent rate and hes starting to get credit cards again. but hes smart and took classes to prevent him from falling into debt again. it will suck for awhile but it will be ok in the distant future. its better than sinking in debt and having nothing go up for you. but relax because alot more people have been in ure shoes and not everyone has always done nothing but pay attention to their credit. some of us have other things going on and cant pay complete attention to a score. just be smart this time and dont let ure husband or anyone else sink you. you have to be tough after you file because you only get one chance before your really screwed. GOOD LUCK and yes theres hope

Answer 9

DONT FILE!!!!!!!!!!!!!!!!

go to
www.cccservices.com
free and they will help you fix your problems--no more phone calls or guilt. See a consumer credit counselor today. Beware of imposters. This should be free.

Answer 10

www.creditinfocenter.com