Re: question about charge-off?

Posted by Linda on September 27, 2001 at 10:43:53:

In Reply to: Re: question about charge-off? posted by AY on September 27, 2001 at 10:01:34:

Do you mean if you take bankruptcy?

No one can do anything to you if you take bankruptcy. The bankrupcty laws are federal laws which give you protection from your creditors if you have become so indebted that you cannot pay your bills.

You must get a lawyer to file this in bankruptcy court for you. Do not use the big clinics that advertise on TV, look in your phonebook and find a regular lawyer who does bankruptcies. First he lawyer will explain how this works, and you can ask questions, there is usually no charge for the first visit. But, you will have to pay the lawyer up front to file the court papers for you, so get some cash together (around $600-$900 depending on where you live and how complicated your case is).

Once you file for bankruptcy, no one can ever try to make you pay these debts, They will just disappear forever. As soon as your bankruptcy is dismissed, you will get offers for secured credit cards. The terms will be worse than what you are used to, but you have to start over. :) Build a good track record with one or two secured cards for about a year, and then ask to have the cards unsecured (your deposit is refunded) and you credit limits raised, interest rates lowered, etc. After 2 years of good payments you will be okay for car loans and mortgages, and some credit cards with decent rates. The actual record of the bankruptcy will stay on your credit report for 10 years, but it's importance will diminish with time and a good payment history.

Look under the links to your left "Books" - the first book that comes up is "Guaranteed credit" that is a good book to use to help guide you in rebuilding your credit. Be sure you learn from this so it doesn't happen again, because you cannot take bankruptcy over and over.

If you do not take bankruptcy, your charge offs will be on your credit report for 7 years, the credit counseling will be on there for 7 years, there will likely be multiple late payments reported, and then the collection agencies will start trying to collect the amounts you didn't pay. Many of these collection agencies will use abusive practices trying to collect this money. They may even take you to court even though you reached an agreement with the original creditor. And they will continue to put bad stuff on your credit report for years to try to make you pay them even though you do not owe the money to them. It can go on forever - there is no limit for them to attempt to collect the money.

I hope this helps. Please, do yourself a favor, and go talk to a lawyer.

Linda

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