Filing for bankruptcy assistance....?

Boy, this kind of bothers me. I'm sorry but your friend got himself into the situation and should WORK to get himself out. I don't consider BK as a means of bailing someone out from poor decisions. There are situations where BK is justified and necessary but this doesn't sound like one of those situations. Maybe there is more that we don't know like an illness or business failure and if so, please disregard my post. However, if it is just poor use of debt for personal pleasures, than he should work it out not run from the debt. He will be better off if he deals with it honorably.

 

its not worth claiming if your debt is less than a 100 k. it will also stay on the credit report for 10 yrs, not 7. any hopes of buying a car on credit or a home will screw this up !!!!!!!!! i personally would not file any types.

 

I second that. Filing BK used to be such a huge stigma, but now too many people use it as a means of living beyond their means and getting away with it. It will catch up to your friend, though.

 

It's not that big of a deal these days. Yes it stays on your credit for 7+ years and it will mean that getting credit will cost you more. It's not like you won't be able to get it. They've changed the BK laws so that you can't have the debt wiped off. Your friend can go to the local bankruptcy court(check online for location) and pic up a filing kit. You can file a BK yourself Pro Se and it will cost you $195. If you use an attorney expect to pay several thousand by the time it's all said and done. Good luck with it.

 

Don't we all end up paying for those who file BK???

 

As a banker, I've seen my fair share of bankruptcies. Tell your friend to tighten his belt, show some spending restraint and tough if out for 6 to 12 months. He'll come out of it with a clean credit record and hopefully have attained a certain financial discipline.

As far as the legal-shmegal b*llsh!t goes, he can try to hide behind it, but the truth is, once he files for bankruptcy:

1. (odds are) NO bank will want to deal with him;
2. (guaranteed) NO credit officer will even give him the time of day;
3. (guaranteed) Forget any form of credit for that matter;
4. I don't know how it works in the US, but in Quebec, NO landlord will rent him anything.

Bottom line: Bankruptcy follows you like herpes!

 

Damn straight! Ask your self why intrest rates on CC are so high. OTOH, CC companies are also are at fault since (some of them) issue cards a little too easliy.

 

You're right, it's nothing more than sugar-coated theft.

Sarcasm off.

 

Oh come on.

I get BK filings across my desk monthly. Its simply a financial planning tool, just like the equally valid Medicaid planning wealth seniors do!

Lets suppose you run , oh...say a car lift company that sells 4 post lifts. Say steel prices are up and you can tell you are going to run out of money. A good strategy is to simply charge credit cards on prospective customers, collect the $3428.00 each, spend or loot it and then file for BK! Why didn't I think of that!

And BTW, it is DEFINITELY NOT the fault of the poor soul who has to file; it is the fault of the CC companies with their easy terms and the merchants that, through deceptive advertising, FORCE people to buy luxury goods they don't need so they can hold their heads high in their pre-planned suburban developments.

Why should there be ANY stigma associated with this logical and legal financial planning tool?

 

If you contact a bankruptcy center or financial aid as they are most likely called in english (it's a Bureau De Syndic in french-canadian), there's a half way agreement, where you deal with the bureau (they take care of your creditors, you pay the Bureau) and it won't ruin your bank life as bad.
And you keep a bit of dignity.

 

Thank you very much! Exactly my point. There's a reason why I haven't filed BK. I limit my spending. Geesh. What a concept. It's the, "guns don't shoot people...people shoot people" argument. Credit cards don't bury people in debt. People do.

So now, I must pay for someone else's irresponsibility. I'll quit now before I get too hot.

 

Well, all that may be true, but at least you can still get all the health care you desire by showing up at an Emergency Room where the hospital and doctors are require by very strict laws to give you all the medical care that you might want or suffer severe fines from the Federal Gov't!

You can even say to them that you have no intention to pay and if you sense ANY evidence of care below the best available at the facility you will report them to the Feds.

There is simply no limit (really, no limit) to the money that must be spent on you in this circumstance. So don't worry! You can still run up bills you have no intention of paying! And laugh in the care-givers faces!

 

LOL!!!!!!!

 

You know, if I was any dumber, I'd have my own credit card company too. I wouldn't even have to be greedy with a 22% or more APR, I could give everyone, good credit, horrible credit a 7% APR and they would all come to me beating my door down to get a card. Since people can't file chapter 7 anymore, they're locked into paying either way! (insert owned picture here) Muahahaha, show me the money!

 

It is largely due to the CC companies that the recent changes to the BK laws were put into place. Now you can't just have the credit card debt discharged but are required to still pay it.

If you are put into a financial bind and need a temporary relief then a BK is sometimes your only option. It can help people who are about to lose their homes for example due to an unfortunate circumstance.

I've never used and don't plan to either but it is there for a reason if used as a last resort.

 

There are still, some credit financial institutions that live in the dark ages. If you as a consumer are hit with identity theft, you are responsible. They are unsympathetic to your situation, an amount is due... pay it now, or we're coming after your house.

 

I could not agree more. However, the thread's subject is not any of these cases and that's why I'm a bit peeved.

 

Bingo!!!

 

It does not work that way in the U.S. There are separate scoring models for consumers who have discharged bankruptcy vs. those who have not. Your credit score within 12 months after bankruptcy can be 700+ if you know what you're doing. Banks can and regularly do grant credit to consumers who have discharged a bankruptcy. And credit card companies fiercely compete for the right to grant you a credit card -- again.

Bottom line: Bankruptcy is, as Uro Trash indicated, simply a financial planning strategy. That may change in mid October when bankruptcy reform takes effect.

 

Right. One can have a strong 650 score and have declined credit card offers which would have granted him/her extended credit lines. This versus someone with a 700 score who has week credit but a high line of credit. It's called a week 700, correct?

My understanding is that credit scores are more than just the numbers. They are subject to interpretation. Please correct me if I'm wrong.

 

The guy that owns the company I work for has a bankruptcy on his credit report. I have personally seen his credit score when we both pulled reports from www.myfico.com (a great tool btw) and his middle score was over 700. His bankruptcy is about 5-6 years old and he can get a loan anywhere.

 

Maybe my reply was a tad harsh..

You're right about the CC companies all too willingly granting cards to repeat offenders.

Banks/loan officers won't necessarily slam the door in your face, but rest assured that they'll be more cautious.

In Montreal, since it's a rentor's market, landlords tend to stretch their legal (civil rights if you wish) limits in terms of acquiring a credit check on possible tenants.

...and so on.

The message that I really want to get across is that far too many people declare bankruptcy because THEY got themselves into a financial rut by living FAR beyond their means. And they see this option as the equivalent of confession and absolution...without having to make restitution for their sins.

 

Credit scores are just numbers...There are three CRA'S (Credit Reporting Agencies)..Equifax, Experian, and Transunion...These three bureaus collect information on people on how they pay different accounts, whether revolving, installment blah blah...THE CRA's DO NOT SCORE YOUR CREDIT, THEY SIMPLY REPORT IT. Other companies score your credit, they most widely known and used model is the FICO (Fair Issaics Corporation). The bank looking to extend you credit will pull the report from one or all of the CRA's and simultaneously score it using the FICO scoring method, thus giving you your credit score. Most LARGE banks will go SOLELY on this as far as scoring your credit worthiness though if there are any outstanding judgements or collections, they will many times ask you to pay them off before giving you the loan. The site I gave you www.myfico.com is the best way to get your own personal score...do not use the ones from equifax.com, transunion.com, and experian.com....They are not the scores the banks will be looking at. There are ways to REMOVE bankruptcies,judgements, and collections from your reports....anyone telling you otherwise is not fully informed on the nature of this whole biz. I have personally removed a judgement from my own report that is still on file with courthouse...Its just like anything, just gotta know how to do it. Bankruptcies are by far the hardest to remove, but it can be done. Im not going to give you any advice on whether he should declare bankruptcy or not, to each his own. I would suggest for him to get on myfico.com and pull his report and then go to their "What if" section...it will tell you what your score will raise or drop to if you take certain actions...like in this case...declaring bankruptcy.

 

You're right. You have to look at the entire credit report (amount of credit available, % used, repayment history...) and not just the score; as well as other factors: net worth, employment history...