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Karla is correct, a BK will stay on your credit report up to 10 years but it can follow you for the rest of your life. If and when you apply for a mortgage, you will be asked if you ever filed for bankruptcy. Your answer will affect your ability to get a loan and your interest rate. It does not matter if the bankruptcy is no longer on your credit report, you still must disclose your bankruptcy. Don't make the decision to file bankruptcy lightly.
Actually 10 years is the max.
And, as for impacting your ability to get a loan in the future - that is not necessarily true.
If credit card companies go through that route depending on the amount of money that is legit or non legit owed and do get a judgement,it is still the first step.A judgement means nothing if it can`t be collected.Garnishment is also not 100% collectable.You can switch jobs or work cash.It all depends from the debt size and person employment and other aspects.
There are many counselors out there but beware. Find one that is legit. A friend of mine used a Credit Counseling service years ago. They negotiated with his credit card companies and got the interest way down and then he would send a check to them each month and they would disperse it among his debtors. It took him several years but he paid back all of his debts and he has a 775 credit score now. So, they are not all bad.
Consumer Credit Counseling is one of the good ones they are part of United Way.
Make sure if you chose this option that they are one of the CCCS offices.
The legit counseling services are different that the credit repair places. They get your debt paid off, the repair places try to play games to just make it go away and if you read the fine print they even say they can't remove legitimate debt and debt history only time will do this
We are in the process of credit counseling right now. We thought about bankruptcy but felt that we used the cards, we owe the debt. So We looked at several before we found one that is legit. They talked to the card companies for us and got our interest rates lowered. We send them a check once a month and they disperse it to the companies. It has worked great for us. Our credit took an initial hit but now it is slowly going back up. Some of the companies I looked it were really fishy. Some of them were "supposed" to negiotate a "settlement" that only paid part of the balances and while we were in "talks" we weren't supposed to pay the cards anything. The whole thing just didn't smell right. We are very happy with the service we chose and it is so nice to see our balances falling every month.
We are in the process of credit counseling right now. We thought about bankruptcy but felt that we used the cards, we owe the debt. So We looked at several before we found one that is legit. They talked to the card companies for us and got our interest rates lowered. We send them a check once a month and they disperse it to the companies. It has worked great for us. Our credit took an initial hit but now it is slowly going back up. Some of the companies I looked it were really fishy. Some of them were "supposed" to negiotate a "settlement" that only paid part of the balances and while we were in "talks" we weren't supposed to pay the cards anything. The whole thing just didn't smell right. We are very happy with the service we chose and it is so nice to see our balances falling every month.
You are a great example that one can continue to take responsibility, have been thorough in your research and have found the happy medium between fulfilling an obligation and affordability. You've found a solution instead of resorting to the blame game. Happy for you!
Last edited by BagongBuhay; 01-30-2008 at 10:10 AM..
Reason: sp
I agree with the posters that advise you to own your debt. My 27 year old daughter is working a full time job and a second job to pay her debt. She made the mistakes many young college kids make, but the good thing is she has learned and she is paying the price. I am so tired of the new age mentality that is so poplular today that you can buy a house and walk away from it without a second thought and turning around and buying another one with the equity pulled from the first loan. Sad
And, as for impacting your ability to get a loan in the future - that is not necessarily true.
My post said "up to" 10 years which would mean the same thing as the max.
I would be interested to hear how filing for bankruptcy will not impact your ability to get a mortgage in the future. That is a standard question on mortgage applications.
Hi there. I live in Illinois, and have 20,000 in cc debt. I ran the cards up, and when I lost my job and wasn't able to pay them, I stopped. I'd like to pay the money back now so that I can clean up my credit, but I only make 20,000 a year. Should I just file for bankruptcy, or should I try to re-pay the debt?
Other individuals here suggesting bankruptcy are wrong.
First, by filing bankruptcy now, it stays on your credit report for 10 years, not 7 if you do not pay off the debt. It does stay for 7 years, but only if you file chapter 13, and that takes years to come out of.
If you simply do not make any payment on the card, they become non-collectible, usually 5 years after the last payment (varies by state), and fall off 7 years, after the last payment.
Faced with the choice of
7 years from the last payment, which is probably a year ago, or bankruptcy, which is 10 years from now, bankruptcy is a stupid suggestion and I'm surprised to see so many people continue to suggest it.
Yes, by not making payment the creditor can go to court and seek a judgment, but even judgments expire if not renewed (again, usually every 5 years). Creditors are about saving money, not continuing to **** good money going after bad debt.
Finally, do not even attempt to make a payment, or payment arrangement with your creditors, unless you plan to pay it off in full. The minute you do, you validate the date, and the 7 years starts all over, meaning the past time that you have not made payment does not matter, and you give them another 7 years to come after you.
You can also get a second job or a job on the side paying cash - babysitting, driving people, etc.
Good luck.
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20,000 in credit card debt...
