Rebuilding credit

I am new to the forum but feel I need to be a part of the forum to get advice and more understanding about how to rebuild and keep my credit in good standing. This is where my credit stands at the moment. I had a bankruptcy that finally after ten long years came off last month. I had no credit so I opened the Opensky secured card and the Primor secured visa's. Low credit limits of $200 on each. I was also just approved for a Fingerhut account with a limit of $500, and I have a 12 month car repair loan that I started paying on 3 months ago. They report to Transunion and Equifax only. I just made my first payment on Opensky and only charged $50 the first month/ I still have some bad debt from 2011 on all three reports. They are collection accounts a total of (6) totaling $1,900. I have never made any payments on these collection accounts and would like to know the best way of handling these accounts. The highest one is $600 and the lowest one is $70. Credit Scores as of 8/3/2015 are: Transunion 591 Equifax 593Experian 603 Can I expect these scores to go up as I make on time payments on my new established credit accounts (4) in total? and what should I do about the 6 collection account. I really want to do this right for the first time in my life as I am now 49 years old and have never been responsible with my credit. Thanks Tim - Phoenix, AZ

I'm in the tough love catagory and this is based on my personal experience. The best way to move forward is by fessing up and fulfilling your debt. For years i tried hiding behind the fallacy that i won't have to pay the debt that i didnt make good on and it'll eventually fall off. Well, that's a painful seven year process that will probably cost you more in high interest rate loans. If you pay off your debt, there's a chance the collections agency might even erase the collections account off your report. My credit score started making strides in the right direction after that. All my credit card limits started climbing from approximately $300-400 limit to $6000 (my lowest now) and $15,000 (my highest at the moment). Your 12 month car repair loan, is it an installment loan or a revolving loan? I once had a loan thru Beneficial which i assume was an installment loan but was really a revolving loan and that also killed me because i started the loan with 100% utilization and sometimes going late which brought it above. Having a revolving account close to/at/or above your max utilization is horrible for your credit. If it is a revolving credit line, pay that down/off as quick as possible. If it's an installment loan, you're good as long as you make minimum payments ontime. When are the statement dates on your three credit cards? Mine are staggered a couple at the beginning of the month, and one in the middle. Put all your spending on your credit cards. Since your credit line is really low, you will have to make multiple payments per month. This will show to the credit card company that you need a much higher limit and would probably increase your odds of a credit line increase. On one of your cards, pay in full at least 3 days (or more) before the statement due date and don't spend on that account for 3 days after. So theres a 7 day black out date on that one card and this is to keep your utilization at zero on your credit report. Do the same thing with the second card, spend a lot, pay it down, but keep a very small $2-18 balance on the credit card during the blackout date. This is to keep a 1-9% utilization on that card. After a few months of doing this with your credit cards, try for a credit line increase. Most credit card companies have a "LUV" button on their website which will give you an automatic credit line increase.

Similar Messages

Need car loan, having difficulty rebuilding credit.

Hi there! 4 years ago, I was unemployed for about a year. This caused me to lapse on quite a few bills which ended up in collections. Since then, I've paid off about half of them, but the other half have been very difficult to pay off (either the CA has not been helpful in even sending me a letter saying that they will mark it as paid, or other reasons). I have a steady job that pays around $80K, and recently my fiancee's car died. So, we applied for a car loan... which was rejected for derogatory marks (it was made clear that even with a good cosigner, I would not be approved). I have been unable to get any forms of credit to rebuild my credit history - the best I have is a secured credit card (which itself has good history) and am on my fiancee's card (which has good history). I'm simply unsure of what to do at this point. A dealership offered a loan at 25% APR, but it raised the price of the car such a ridiculous amount that I simply cannot afford it anymore (and I can't justify paying _double_ on a car in the end after interest). I honestly have no idea what to do here. Paying off all the creditors still won't remove derogatory marks. Nobody is willing to give me credit other than a ridiculously expensive car loan. I really can't wait a few more years for things to drop off. My current FICO scores show up from the low 600's to the upper 500s. I have been unable to get them to change. Help?

You are pretty much stuck in a deep rut. I was in a similar situation and at the bottom, you just have to make a move, and keep good receipts and records. My suggestions:Pick a debt that is updating monthly on your CRs and after verifying that a CA is the owner of the debt, pay one off. You may not get a PFD, I never did, but several did come off after it was settled, especially medical bills. Some CAs will allow you to make a payment plan, but you must be able to complete it. Others require a lump sum. If you can get the OC to recall the debt and cancel the CA, that is the best arrangement. Then you pay the OC and the CA has no authority so has to be removed from your CRs. If you cant get a PFD and you cant do a PIF, then try for a settlement that will at least make it 'legally paid for less than original amount'. Try to get secured cards, they will still count as Revolving accounts. If you can get a secured card that will graduate to unsecured, that is ideal. You need at least 3 revolving accounts. Keep paying off old debts and keep current with new obligations and your scores will improve. I saw good increases after I got each of my first three cards, and they were all small, as in 250 secured and 300 to 500 unsecured with extremely high interest rates.. hth ETA: And go the Rebuilding Credit forum and read everything! Even posts that dont look like they might apply to you will have info that will come in handy at some time in the future.

Rebuilding Credit- Help and Advice needed please

Hello, i'm currently working on rebuilding my credit. There are 2 charge offs and 2 collections ( for those charge offs) on all three credit reports. I would love some adivce on the best course of action. I am in MA and the SOL is 6 years. Thank you! I do have positive TL's, the ones posted below are the only negative items on my report. I also have paper copies of my report just not with me right now. MyFico scores (FICO8) are currently EQ: 654 TU: 643 and EX: 648 This is what it looks like on Experian:Account 1:Account nameCOMENITY BANK/EXPRESSAccount numberXXXXXXRecent balanceNot reportedDate opened12/2006StatusClosed. PO BOX 182789COLUMBUS, OH 43218No phone number availableAddress identification number0000621071TypeCharge CardTermsNACredit limit or original amountNot reportedHigh balance$1,667Monthly payment$0Recent payment amountNot reportedDate of status02/2015First reported01/2013ResponsibilityIndividualCommentPurchased by another lender. Account 2:Account nameCOMENITY BANK/VCTRSSECAccount numberXXXXXXRecent balanceNot reportedDate opened04/2007StatusClosed. $1,171 written off.O BOX 182789COLUMBUS, OH 43218No phone number availableAddress identification number0788274468TypeCharge CardTermsNACredit limit or original amount$370High balance$1,171Monthly payment$0Recent payment amountNot reportedDate of status02/2015First reported04/2007ResponsibilityIndividualCommentPurchased by another lender. COLLECTION 1Account namePORTFOLIO RECOVERY ASSOCIATESAccount numberXXXXXXXRecent balance$1,668 as of 07/08/2015Date opened02/2014StatusCollection account. $1,668 past due as of Jul 2015.20 CORPORATE BLVD STE 100NORFOLK, VA 23502800 772 1413Address identification number0000621071 Original creditorWORLD FINANCIAL NETWORK BANKTypeDebt BuyerTerms1 Months On record untilMay 2019Credit limit or original amount$1,668High balance$0Monthly payment$0Recent payment amount$0Date of status05/2014First reported05/2014ResponsibilityIndividual COLLECTION 2Account namePORTFOLIO RECOVERY ASSOCIATESAccount numberXXXXXXRecent balance$1,172 as of 07/08/2015Date opened08/2014StatusCollection account. $1,172 past due as of Jul 2015. 120 CORPORATE BLVD STE 100NORFOLK, VA 23502800 772 1413Address identification number0000621071 Original creditorWORLD FINANCIAL NETWORK BANKTypeDebt BuyerTerms1 Months On record untilAug 2019Credit limit or original amount$1,172High balance$0Monthly payment$0Recent payment amount$0Date of status11/2014First reported11/2014ResponsibilityIndividual Also under the potentially negative items section is a capital one credit card that I had that was closed and I paid off and this is what it shows:Account nameCAPITAL ONE BANK USA NAAccount numberXXXXXXXXXXXXRecent balance$0 as of 07/17/2015Date opened02/2005StatusOpen. PO BOX 30281SALT LAKE CITY, UT 84130800 955 7070Address identification number0000220565TypeCredit cardTermsNACredit limit or original amount$1,500High balance$1,702Monthly payment$8Recent payment amount$0Date of status02/2013First reported02/2005ResponsibilityIndividual

The subcontractor left the bt socket off the wall, holes in my fresh painted skirting board as he didn't want to get his drill so tried to mount on the skirting, also tried to mount the modem on skirting! . He said do I want to mount it all!? I said yes due to the mess he was making of my new house. I'm field staff for a rival company so the mounting was no problem. But what he did do was use telco wire from x2 terminals from the I plate I think it's called to data socket. When ethernet plugged into socket my bb drops? Hence I had to take it away. When he left I was getting approx 40 meg throughput, this has dropped to 25 ish since. My brass rate is still 56.56 dropped from 58mbps. I have made good his damage so won't raise a claim. But if anyone could offer advice, that would be great. I would also like to communicate with a moderator if poss? Thanks

Can we build equity and acquire assets without banks while rebuilding credit??

Hi.Thank you for taking a look at my post. I hope we can help each other. I have 3 goals for this post. 1 - to reach out to this community for opinions, leads, and hopefully contact info for private lenders who really do lend based on the asset and not focus on our marred credit. 2 - maybe members (and of course me) can find someone else on this site who is/are in similar situations and can put resources together to start making lots of money without the banks. 3 - just being honest...I simply need to vent my frustrations in a safe environment where I'm sure there are others who can relate :-) I am getting back into real estate fix & flip, rehab after several years of life altering events and recuperating from personal injuries. I am not an agent or anything like that. I'm just really good at finding and negotiating awesome deals that I end up having to flip. I've worked my butt off to save and purchased one here and there but I need to find funding to get to the next level. I joined this site because my credit is in repair and I'm working the information I read about in this forum. Having gone from a high level of success to wondering how I was going to get from the bedroom to the bathroom, I feel like this is the one place I can trust to put myself out there and get meaningful, non-judgmental peer-peer responses with solid pertinent information. Hence why I could use some opinions and hope to get some leads on lenders that might help me out. With several properties under contract, I'll have to flip to other buyers at discounted values if I can't find a lender. I've spoken with about 20 lenders who claim they are "private", "hard money", "Asset-based" commercial loans, investor driven, bad credit, blah...blah...blah...only to find out they really are just like dealing with a bank. I am not claiming to have great credit and I realize on paper I look pretty weak. However, the whole time they are making claims they are not credit driven...what do you think the first thing they want is...yup...credit scores! Even though the numbers of the asset are very strong and purchased in an LLC. They all require full doc personal financials...the whole time they are saying they don't really judge you on credit....RIGHT! While these "direct lenders" and "private money lenders" may not have to work under the federal bank lending regulations, THEY are not interested in anyone who doesn't meet THEIR rigid requirements. Which in reality are exactly the same as the regular banks. I have yet to find one lender that truly bases their decisions on the property asset without pulling credit, bank statements, etc. They all will only lend a portion of what is needed (50 -75% LTV or LTC )based on the lowest value they can determine (Purchase price or appraisal which ever is lower) which means they have essentially no risk and the investor has to bring in a lot of cash. No difference. They are essentially all the same and just boast about being different. This is all fine if that is how they run their business. I am the last to judge them for that. However, I am tired of wasting my time talking to company after company making these claims but really won't put their money where their mouth is!! I have also looked into a lot of the sites for peer-peer funding. In general they are all fantastic and serve a great purpose. Especially for kids and fundraising purposes. But I'm working on a business. On those sites, you really have to put your self out there on the front line and air your dirty laundry to the world in order to participate. I realize I could do that and tell my sad story and why I want people to invest in me and my project. Frankly, maybe I'm too proud or going about this all wrong but I'm just not ready to post my story to the world and ask my friends and family for handouts. I don't want people feeling sorry for me or my name all over the internet telling people my credit sucks (even though it isn't that bad now). Let's be honest - who posts on a peer-peer funding site for their own benefit if you have your financial life in order!! That said, I'm sure none of us would be on this site if we didn't have or have had financial turmoil in our lives. Who cares why.. it happens. Hopefully, we all realize that is not what defines us as people and we can all achieve our dreams like any one else. It just might take longer, or a bit more work. You get the picture. So I thought, what if others on this site are experiencing the same things. Do you feel like you are missing out on opportunities to make your money grow? Maybe you have improved your credit but don't have enough cash to get a loan. Maybe you can't get a loan because of credit but you have cash. Maybe you can't get a bank account and are missing out on investment opportunities because your money is sitting under your mattress. Seems to me people on this sight are all focused on the same thing and have the best interests of others in sight. We also have this fantastic forum to discuss our money issues and glean insight and information from others that helps us improve our situations. I'm wondering if we could partner up our strengths and find ways to benefit by working together with other like minded members. You thoughts are of great value. Please post.

Are you debt free? Do you have any cash to throw into this? If no... what about subbing out under someone else or getting in GCing or Foreman for a bigger company while you cleanup your personal finances? Real estate is AWESOME, but if you can't cashflow at least a good chunk of it, you can get in a pretty scary spot... What kind of assets do you have? Could you flip your own home and use those monies to invest in your next flip and live as cheap as possible through a few flips until you have a good bit of cash built up?

Need help with rebuilding credit.

I am not sure where to start. My credit was ruined when my ex and I split. He let the house and everything go even though I told him he wouldnt have to pay child support if he just kept it all going until we sold. That is now off my credit but after I was so scared of my credit I didnt open anything. I had the mentality if I didnt have the money for it I couldnt afford it so I didnt have credit cards. Now when I go to apply for a car loan or a house they are saying I dont have enough established credit. I am trying to figure out the best way to do that without messing my score up. The last time we pulled my scores was 2/25/15 they were EX 596 TU 685 EF 657. I have a Capitol One card but am wondering which other cards I should try to help establish more trade lines? I was thinking about doing a CareCredit card but am nervous I will get declinded. Any help would be very appreciated. I have one public record that was paid 4/12 and it says I have 5 collections but they are all paid or closed?

First step...I would pull all 3 of your reports from www.annualcreditreport.com if you haven't in the last year and see what's actually on there to make sure they are accurate. Something seems strange with the disparity between EXPERIAN and the other 2, so maybe there is something on that report that is not correct. If you do have any baddies, paid or not, search the forum and try to use PFD or GW techniques to have those removed where possible. In some cases, if they are near the SOL in your state, the best bet is to just wait for them to fall off that way or you could get an early exclusion from the CRA's... From there it's really about finding what type of credit best suits your needs. If all your scores end up between 650-680 you should have quite a few options available to you. I'd search the forums and do a lot of reading/research to determine how best to move forward in establishing more positive tradelines.

Rebuild credit with cash loans?

I am one year out from a Chap 7. I have several secured credit cards and the balances are very low. I have been getting offers for cash loans in amounts of $600 or so. Is it sensible and will it help my credit if I accept a loan and make the payments by setting aside and using the funds themselves? I could pay more as well to avoid paying too much interest in the long run. A small amount in interest paid would be worth a bump in my credit.....but is that what will happen?

Installment loans don't have nearly the effect on your credit score that revolving credit cards do. So in short, they will help the credit mix of your profile but you will see little to no impact on your scores.

Rebuilding My Credit...

Here's a timeline of my rebuilding process, since my bankruptcy in 2012 to clean up my mess from stupid decisions prior. Any and all input is welcome! Average FICO from CCT 07/20/2015 - 65607/18/2015 - 656 Notable Information Bankruptcy Chapter 7 discharged in 08/2012.Student loans stuck with me. I paid them off in 04/2015.Few other accounts that still show on my CR even though they were discharged, going to work on getting them removed some time...http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Seeking-all-Advice-on-Rebuilding-Credit/m-p/4137995#M432015 Lines of Credit Opened - Limit - Bank/Store info09/2013 - 1500 - Jared10/2014 - 2300 - Capital One Platinum MC12/2014 - 250 - Comenity/Vic Sec03/2015 - 1300 - Barclays07/2015 - 2000 - Synchrony/FFF07/2015 - 600 - Synchrony/WM07/2015 - 6000 - Synchrony/Lowes Total Credit - $13950 as of 07/20/2015 Notes Approved for 3 through SynchronyDenied by Citibank for HD on 07/20/2015 This is a work in progress, if you want to follow me, feel free. If you want to make suggestions, feel free.

Here's a timeline of my rebuilding process, since my bankruptcy in 2012 to clean up my mess from stupid decisions prior. Any and all input is welcome! Average FICO from CCT 07/20/2015 - 65607/18/2015 - 656 Notable Information Bankruptcy Chapter 7 discharged in 08/2012.Student loans stuck with me. I paid them off in 04/2015.Few other accounts that still show on my CR even though they were discharged, going to work on getting them removed some time...http://ficoforums.myfico.com/t5/Rebuilding-Your-Credit/Seeking-all-Advice-on-Rebuilding-Credit/m-p/4137995#M432015 Lines of Credit Opened - Limit - Bank/Store info09/2013 - 1500 - Jared10/2014 - 2300 - Capital One Platinum MC12/2014 - 250 - Comenity/Vic Sec03/2015 - 1300 - Barclays07/2015 - 2000 - Synchrony/FFF07/2015 - 600 - Synchrony/WM07/2015 - 6000 - Synchrony/Lowes Total Credit - $13950 as of 07/20/2015 Notes Approved for 3 through SynchronyDenied by Citibank for HD on 07/20/2015 This is a work in progress, if you want to follow me, feel free. If you want to make suggestions, feel free.

How to Rebuild after BK and Go from Secured CC's to an Unsecured?

In 2011 I filed a Chapter 13 BK (I'll spare the sob story since I don't want to get depressed). A year later - after making prompt payments to the trustee, I was furloughed from work due to the economic downtown and no longer met the min income qualifications for the BK payment plan; therefore the bankruptcy was dismissed.I can't even start to explain how bad this sitution turned out for me. I was told that if I wanted to keep my home I couldn't file a Ch7 BK, and didn't seem to get anywhere with the legal help I needed. At one point I found an Attorney that promised to help straighten everything out.. charged me $500 and never saw him again - he did nothing for me but don't worry I was able to get the money back. I read articles, forums, books etc.. to educate myself on what to do. But all in all the creditors didn't want to work with me and I felt so LOST :/Finally, everything paid off when I found a decent Attorney to help me file a Ch.7 BK and it was done in 2014 and discharged with no issues. But with this, I've been hit twice on my credit report and made it almost impossible to rebuild credit I have 3 secured credit cards (Merrick, Opensky, and a Credit Union). I also was just able to refinance my 19% auto loan to a 5% loan - which I'm extremely thankful for. The issue now is that no one is willing to give me an unsecured credit card - not even CapOne - who most claim are the best at this. How do I go from having secured cc's to qualifying to an unsecured? my cards don't seem to graduate to unsecured and although I've grown addicted to checking my scores and reports I can't seem to find a way - I tend to grow impatient, and I spend way too much time on all these credit forums (credit.com,CK,creditboards, etc) its seriously becoming insane. My scores aren't really that bad (I think) but I think its the 2 public notices on my report that I believe are hurting me the most - any feedback on that? Scores are; EX 669, TU 662, EQ 675 I also hired a company who is helping me with my credit repair because I found myself going crazy mailing letters and paying certified mail costs and getting nowhere with the CB's.So where do i go next?? Thanks everyone

First off - dump the credit repair company. They simply CANNOT do the things that you can do, despite the promises they make. How old are your secured cards? Have you maintained perfect payment history forward from the discharge? Do you have current credit reports and is everything reporting as IIB with balances zeroed out?

Looking hopeless, 400s scores starting hopeless journey to major credit repair

Hi everyone, I'm new to this forum and myfico. I'm 25 years old and today I decided to get serious about fixing my credit. I got tired of believing that I'll never have a 700 score in my life and have been trying to make the steps necessary to fix some major damage. I was young and stupid and let every account in my early 20s get charged off. I've never made any consistent payments and due to all that stupidity and neglect, no one will take a chance on me now. In fact, I have now been declined for multiple SECURED credit cards, including Bank of America, TOTAL Visa, Wells Fargo,and CapitalOne which I thought was impossible. In fact, I've never been approved for anything nor have I even gotten close to being prequalified for anything. I checked my scores and I'm starting at 476 TransUnion and 490 Equifax according to credit karma and 500 Equifax, 492 TransUnion, and 497 Experian according to myFico. I've even gotten declined for a car loan to try to rebuild that route despite the fact my income is great. Money isn't a huge issue any more these days seeing as I don't really owe anyone money and have been paying everything in cash. I've got 7 charge offs, 2 of which from 2008 which I'm in the process of trying to get removed from my reports. I had a car loan that I defaulted on and got repossessed last year that I was able to fully pay off the day of the repo but is recent and still a major sting on my reports. The only revolving account I have is a $500 secured credit card from a local credit union. I also bought a blender from FingerHut today and will commence payments on that from this month on. I also tried this website called SelfLender that puts money into a savings account and said that it would report and help rebuild credit but haven't seen it reported on anything yet. I applied for Crown Jeweler's and am awaiting a decision. And I have a student loan that just entered repayment this month. What else can I do? Should I open more secured credit cards? More credit rebuilder loans through credit unions? With what I have right now, do I just sit back and wait? Do I dispute everything negative on my reports even if they're accurate? Some of you guys' stories have been inspirational. But right now I feel like there's really no hope since my scores are about as bad as they can get. Getting declined for secured cards and the idea that no one will take a chance on me even if I pay them to is really making all of this seem impossible. Any input would really help!

NormanFH wrote:
rockbottom11 wrote:
Hi everyone, I'm new to this forum and myfico. I'm 25 years old and today I decided to get serious about fixing my credit. I got tired of believing that I'll never have a 700 score in my life and have been trying to make the steps necessary to fix some major damage. I was young and stupid and let every account in my early 20s get charged off. I've never made any consistent payments and due to all that stupidity and neglect, no one will take a chance on me now. In fact, I have now been declined for multiple SECURED credit cards, including Bank of America, TOTAL Visa, Wells Fargo,and CapitalOne which I thought was impossible. In fact, I've never been approved for anything nor have I even gotten close to being prequalified for anything. I checked my scores and I'm starting at 476 TransUnion and 490 Equifax according to credit karma and 500 Equifax, 492 TransUnion, and 497 Experian according to myFico. I've even gotten declined for a car loan to try to rebuild that route despite the fact my income is great. Money isn't a huge issue any more these days seeing as I don't really owe anyone money and have been paying everything in cash. I've got 7 charge offs, 2 of which from 2008 which I'm in the process of trying to get removed from my reports. I had a car loan that I defaulted on and got repossessed last year that I was able to fully pay off the day of the repo but is recent and still a major sting on my reports. The only revolving account I have is a $500 secured credit card from a local credit union. I also bought a blender from FingerHut today and will commence payments on that from this month on. I also tried this website called SelfLender that puts money into a savings account and said that it would report and help rebuild credit but haven't seen it reported on anything yet. I applied for Crown Jeweler's and am awaiting a decision. And I have a student loan that just entered repayment this month. What else can I do? Should I open more secured credit cards? More credit rebuilder loans through credit unions? With what I have right now, do I just sit back and wait? Do I dispute everything negative on my reports even if they're accurate? Some of you guys' stories have been inspirational. But right now I feel like there's really no hope since my scores are about as bad as they can get. Getting declined for secured cards and the idea that no one will take a chance on me even if I pay them to is really making all of this seem impossible. Any input would really help!Look at it this way - there's only one direction from here, and thats UP.Realistically, rebuilding is a long term process that takes a minimum of 24 months. Take it in 6 months increments. You already have a start with the secured credit card from the credit union. Build on that. In a few months the FH account will start to grow. Keep watching your scores, they will improve as you move out from the last derog (the repo?). Once you get into the 500's consider getting a second secured card, either Cap One, or Open Sky. Now, the 7 Charge offs - What are they, and when did each one occur? How are they being reported? Balances?BTW, you are pretty much right where I was last August when I started this journey. After one year of *mostly* just managing and using my credit cards effectively, I've come up about a hundred points.

How to rebuild creidt exposure?

Hi everybody,
Can anyone let me know how to rebuild credit exposure for business partner? What is the purpose of this?
Regards

Hi
This is for rebuilding the credit limit exposure, which can be seen in F.32.
This is not normally used but exceptionally used if there are any organization changes made in SAP.
Yuo can try it first in test system and with test run to see what all customers affected due to this run and understand the consequences to proceed further.
Regards

Does this count as the three trade lines I meet for rebuilding?

Everyone seems to agree that 3 cards are optimal for rebuilding credit. I now have a credit card from my credit union, a capital one secured, and my credit union is giving me a personal line of credit they say with report as revolving.Will these meet the criteria or do I need another secured card?

You should be good. I would not get another secure card. Keep working on eliminating any bad entires (if you have any) and on treating your new tradelines perfectly (never carry a balance, always pay on time). Then you can qualify for an unsecured card next. Keep checking the Capital One pre-qual site to see when you may be eligible for there -- if you treat your secured card well, they'll offer better cards with higher CLs.

Leasing with Mazda- what score do I need to get good lease rates?

So long story I'll try to summarize. I've been slowly rebuilding my credit for years. A few years ago, through a little bad luck and a lot of stupidity my credit scores tanked, low 500s. But somehow, when my car broke down, I managed to get approved for a very expensive lease of $299 a month for a little Hyundai Accent. Now...I have no regrets because it has allowed me to begun rebuilding credit slowly. Since then, I leased another car for my wife, and we have refinanced our mortgage. Bill payment history has been strong for the last 3-4 years. Havent missed a single lease payment o these two cars. Multiple credit cards, all current, and total utilization is less than 30%. All told, I've managed to claw my score into the mid to high 600's depending on the bureau. (677 TU, 672 EQ, 648 EX)...I know that my EX auto score is 660.Not sure of the other auto scores. I am likely not leasing for a few months. Later this summer, an old judgement from 2008 will be falling off my credit reports. How much of a difference can I expect it to make? Will this get me to a level where I can get a good lease rate from mazda for a 2016 CX-5? Thanks

dabrian wrote:
Why not buy? Just curious.If I didnt have my reliable car that was problem free and paid for, I would lease. If you like to drive a new car every 2-4 years, want peace of mind for warranty, don't drive over 20k miles/yr, etc, then leasing is the way to go. Even with leasing people have taken a leased vehicle and traded it in at the dealer (yes, its possible, as the actual value was significantly higher than the residual value due to low mileage/condition) took that profit towards their next lease, and avoided a down payment. That is of course one scenario and doesn't fit everyone. I would NOT be going to a car dealer to lease though unless there were some bangin' incentives (like the hybrids had in california for residents). I would instead go to swap a lease dot com and find some rich person that has 5 or 6 cars and has already made that big down payment capital cost reduction, and is offering to PAY ME to take their car. Sometimes the mileage allowance is over 2k miles a month! $500 to have a car shipped isnt too bad either. I'd want a mechanic to inspect of course before. Now, you can get a newISH car every SIX months to 2 years for even less. And still have the option to buy or trade or return at the end. That is flexibility!

Amex and Navy Fed Approval

So funny thing is I work at a bank, so after truly figuring out and understanding the run down of utilization, limits, and types of lending to establish good credit. After two years of bad credit and a 16% interest rate auto loan, I built my credit score up to the point of applying with navy fed for an $25,000 auto loan which was approved at 2.39% and also a credit card while there which they extended a $12500.00 CAsh Rewards card. I was feeling high and over the moon. So I have been piling up the applications that come in the mail for shred and said well might as well try for that Amex I always wanted and scored a $6500 Everyday Card with them and a $5000 Blue. This is my testimony of doing what is needed to get where you want. I started with an average credit score of 560-600. I now sit at 712 being my lowest and 742 being my highest. I do also have a PNC cash builder credit card that they recently increased to $1000 and a terrible first premier with $250 that card I plan to close. It was my first card I got to rebuild credit. i just want to share my story and say with time it will happen. Never would I thought I would have good credit.

CONGRATULATIONS!!! Welcome to the Amex & NFCU Families! -take care of them, as they will take GREAT care of you- Oh, and don't forget to 3xCLI those Amex's when you get them!

What to do with car after discharge

Hello all. I was discharged from chapter 13 last week. Now my issue is this.... Before my filling I had a car loan with Santander and only owed $900. I actually assumed it was included in my filling. I found out it wasn't from my new lawyer because it's totalled and needs to be salvaged. She says I can have Santander pick it up or release the lein without damaging my newly rebuilding credit. I'm not sure if I understand how it won't affect my credit. Help please

Chapter 13 is different than Ch 7, so I don't have much help, but have you tried asking your attorney to explain how it won't affect your credit?

Bankruptcy FAQs

This information is not legal advice and I am not a lawyer. Always seek a reputable bankruptcy lawyer to answer your questions prior to filing.
- Tuscani
Should I file Bankruptcy?
A person should file a bankruptcy if, and only if, he or she can’t pay bills as they come due or is about to lose property or have property attached by the Court. Very few people lose any property when they file bankruptcy.
Filing a bankruptcy is generally better than having a foreclosure on your credit record. A person will often be able to rebuild credit and buy a house within 2 years after a bankruptcy. A repossession can do more damage to your credit, and it may take much, much longer to recover. Government regulations may forever keep you from financing a home with the VA or FHA if you have a repossession for a home, but allows financing 2 years after bankruptcy. Only 7 magical items may not be bankrupted: Child Support and Alimony; taxes less than 3 years old; federally guaranteed student loans; debts due to fraud; debts due to drunk driving; debts due to intentional injuries; and criminal restitution. There are many exceptions to even these. A driver’s license can be reinstated by filing, if you lost your license because of unpaid damages for an auto accident. When in doubt, always list the debt when filing: It may be bankruptable due to an exception.
What does it cost to file bankruptcy?
After October 2005, Court costs are about$300 for a Chapter 7 and $275 for a Chapter 13. After October 2005 Chapter 7 attorney fees run about $1000 plus any filing fees. Chapter 13 Attorney fees are set by the Court.
What happens when I file?
When you file a bankruptcy, a Court order goes into effect immediately stopping all collection activity. This includes stopping foreclosures, attachments, garnishments, and Creditors calling you. The sooner you come in to the law office, the sooner you can get relief—and the more you can save from Creditors. You will have a 341 hearing within about 4 to 6 weeks after the bankruptcy is filed. When the bankruptcy is finally over, a discharge is issued. This is a final and permanent order to stop all collection activity and declaring the debts to be non collectable. Bankruptcy does not normally get rid of a security interest that you gave to a Creditor such as a mortgage or a standard car lien, but it does make you not liable for the debt.
Can I plan my bankruptcy?
Of course! Good planning is why you read this thread and allows you to save more money and property. Just like taking proper tax exemptions. There is nothing illegal or improper with properly taking the exemptions.
Which bankruptcy is right for me: Chapter 13 or Chapter 7?
A Chapter 13 is like a bill consolidation loan, and you normally file it to keep property and stop foreclosures. A Chapter 7 is used to completely wipe out unsecured debts and to get rid of secured debts for property you don't want to keep. Both will stop garnishments and Creditor harassment. If you earn more than the average wage for your state and size of family you will normally be required to file a Chapter 13.
Chapter 13 cases are becoming more popular. Over 95% of all Chapter 13 cases used to fail because they became unaffordable. But now 10 and 20% repayment plans are being approved in Chapter 13 cases and they are now more successful. After 10-2005 plans below 10% will be common. Often an attorney may want to file a Chapter 13 because he or she will earn more than he would in a Chapter 7, but you will usually profit far more from filing a Chapter 7. Usually, the only times you will want to file a Chapter 13 are 1) when you have already filed a Chapter 7 and can't file another one or 2) if you have so much property and equity that a Chapter 13 is necessary to keep that property.
You may have to file a Chapter 13 if you have so much income (after you pay your normal monthly living expenses) that you can repay something to your debts. A Chapter 13 can no longer be used for special purposes, such as to debts due to fraud. But can repay child support, repay student loans, or protect a co-signer. The fortunate thing about virtually all Chapter 7 cases is that the Debtor’s assets are normally exempt, so there are rarely any assets to liquidate. Each state has different rules for what property can be kept.
Why file a Chapter 7?
If you have substantial unsecured debts you may want to file a Chapter 7. You may also want to file a Chapter 7 if you want to surrender property and not owe for it. You can usually keep all your property in a Chapter 7, because you won't have enough equity in any property to exceed the exemptions allowed.
Why file a Chapter 13?
You may want to file a Chapter 13 if you have secured debts and are threatened with foreclosure or repossession, if you filed a Chapter 7 less than 6 years ago, if you wish to protect your cosigner, or if you have debts that are not dischargeable in a Chapter 7 but are payable in a Chapter 13. Child support can be paid first in a Chapter 13 before secured creditors giving you the advantage of not losing a car or property but having all of your payments go to child support at the start of the case.
Can I convert from a Chapter 13 to a 7 or from a 7 to a 13?
Yes they can be converted. Few people convert from a 7 to a 13. However if you earn over 60-70,000 you have a strong chance that the US attorney’s office will file a 707 b motion that may force you into a 13. If you file a Chapter 13 you have a good chance that you will have to convert from a 13 to a 7. Over 3-5 years, you are very likely to miss payments and have the Chapter 13 dismissed (or have to refile). Some Chapter 13 cases are never finished and are converted into Chapter 7 cases. If you are close to completing the plan, you may be granted a hardship discharge. Plans can also be later modified if incomes change.
What is a Chapter 20? What is a Chapter 26?
Some people file a Chapter 7 to wipe out unsecured debts and then file a Chapter 13 to keep their property. This is jokingly referred to as a “Chapter 20”. Filing a “Chapter 20” can be the intelligent and affordable way to file a Chapter 13 later. Filing a Chapter 7 and then a Chapter 13 to obtain the benefits of both is very effective in stopping a foreclosure. A “Chapter 26” refers to filing back-to-back Chapter 13 cases. You would do this to pay debts that can’t be paid in 5 years by just one Chapter 13. In a sense, you are “extending” your repayment time by filing two Chapter 13s. These forms of filing are no longer available after 10-2005.
How long will bankruptcy take?
It will take about 3 to 4 months for a Chapter 7 to be final. (You will get a letter within 10 days of filing, telling you the time and date of the 341 hearing. This hearing will be held about 4 to 6 weeks after you file.) A Chapter 13 will take as long as the repayment plan takes. If you file after 10-2005 before getting a discharge you will attend a hearing.
What are the most common mistakes I can make when filing?
Not showing up for your hearing and not listing all of your debts. Fail to show up at the hearing, and your case is dismissed. Fail to list a debt, and you continue to owe it. Also people often have too much in a checking account when they file or a tax refund coming. The best policy is to list all your debts and assets. Always list every debt, even if you think it is nondischargeable, it may be discharged anyway. Even include last month’s utilities.
How do I qualify for bankruptcy? Can I not be approved?
You qualify for bankruptcy if either your outgo exceeds your income or your liabilities exceed your assets. You basically have to be a US citizen, reside in the state you file in, and not have filed within certain time periods (you can’t file two Chapter 7s within 8 years of each other).
What if the Court does not approve my Chapter 13 or Chapter 7?
If there is anything wrong with your Chapter 13 or Chapter 7 bankruptcy it will usually be changed and amended. Of course, it is less costly and time-consuming to do it right the first time. If you earn so much money that you can afford a Chapter 13, you will be forced to change it from a Chapter 7 to a Chapter 13. Repayment plans often are amended.
How often can I file?
You can file a Chapter 7 8 years after you filed your last Chapter 7 the time used to be 6 before 10-2005. The time is measured from the time of filing your first case to the time of filing of your second case. You can file Chapter 13s 2 years after a Chapter 13 discharge. You can file a Chapter 7 4 years after a Chapter 13. You can only have one bankruptcy going on at a time.
If I file does it mean my old bad debts are erased from my credit report?
NO!
What is reported is that you had a debt and that a bankruptcy was filed. Bankruptcy does not give you a good credit record or “repair” your credit record automatically. You repair your credit by paying your debts on time after the bankruptcy.
Can I file without an Attorney?
Yes. You can file a bankruptcy yourself, and this is called “filing pro se”. You can also do dentistry on yourself, but I wouldn’t recommend it. Doing your own case is a very bad idea. This thread alone won’t give you the knowledge you need to file on your own. Use this thread to educate yourself, so you can find a good Attorney and discuss the issues.
As an example, if you file a reaffirmation and represent yourself, it must be approved in a hearing by the Judge, and that will mean extra hearings and time for you. Considering the time and risk involved, I recommend you use an Attorney. You may lose far more in Court than what the Attorney would have cost—plus there is the extra time and effort on your part doing the work.
What about a Bankruptcy Mill?
Filing a bankruptcy through a Bankruptcy Mill or paralegal may be even worse than doing it yourself and they often charge as much as the attorney. Many people have lost thousands of dollars with these businesses—through intentional scams or just plain bad work. Non-Attorney bankruptcy petition preparers are barred by law from providing you with any legal advice. In enacting legislation governing bankruptcy petition preparers, Congress stated: “These preparers lack the necessary legal training and ethics regulation to provide [legal advice and legal services] in an adequate and appropriate manner. These services may take unfair advantage of persons who are ignorant of their rights both inside and outside the bankruptcy system.”
The bankruptcy petition preparer's role is limited by law solely to typing. Unlike an Attorney, a bankruptcy petition preparer can not help you understand the law, advise you how to answer questions, assist you in planning, or be in Court. Federal law requires that bankruptcy petition preparers sign any documents they prepare; print on the document their name, address, and social security number; and furnish you with a copy of the document.
A bankruptcy petition preparer may not sign any document on your behalf, may not use the word “legal” or any similar term in any advertisement, and may not receive any payment from you for Court fees. The bankruptcy petition preparer is also required to disclose to the Court the amount of any fee you pay. Beware of any bankruptcy petition preparer who does not comply with these requirements an emergency, even the filing fee can be paid in payments to the Court.
What paperwork do I need to bring to my Attorney?
Bring the names, amounts, account numbers and proper addresses of all of your Creditors. You may estimate the amounts. After 10-2005 you must have the account numbers. Credit bureau reports normally don't have the addresses on them. If you have gotten a Credit bureau report before filing, you still have to get the addresses.
Can I file jointly with my spouse? Does my spouse have to file or sign if I want to file individually?
Yes, you can file jointly. No, your spouse doesn't have to file but, if most of your debts are joint debts, he or she may want to. There is no need for a spouse to file if the debts are not in his or her name. If you are filing a Chapter 7, and the bills are also in your spouse’s name, he or she generally should file to be protected. (Cosigners are protected in a 13 with 100% plans, but are not in a Chapter 7.) There should be no additional charge for a spouse filing, but some firms charge extra. The only extra work to do in a joint filing is adding an additional name and social security number to the petition.
Will it affect my spouse’s credit? Is he/she responsible for my credit cards if he/she is an authorized user?
No, filing will not affect your spouse's individual credit, but if he or she is a co-signer on any debt that is not paid that will affect him or her. The fact that you filed bankruptcy does not appear on a spouse's credit report unless he or she also files bankruptcy. Unless your spouse has signed to be legally responsible, they are not responsible. However, many credit card companies will argue that she is responsible. They may even put a “no pay” on her credit report if the amount is unpaid; however, she may ask any credit reporting service to correct that.
If she does so, the credit card company will have to show that she signed for it. If they can’t, it will be removed from her credit report file. In other words, the credit card collectors may try to collect from her by claiming she is liable, but she really is not. If they damage her credit record, it may be grounds for a lawsuit. Credit is normally granted based on a score from your past payment history, the amount of debt that you owe, the length of time you have been repaying present credit, if you have opened credit recently, and the types of credit accounts you have.
Will my co-signers be protected?
Co-signers are protected only in a Chapter 13 to the extent that the plan pays the full amount of the co-signed debt. If the plan pays the debt completely, the co-signer is protected, but it will be listed in his or her credit record as being paid late. The Creditor may ask the cosigner for any remaining portion of the debt if it not paid completely. In a Chapter 7, the co-signer will have some small protection regarding the collateral during the proceeding, but only because the Creditor can’t go against the property of the estate. After a Chapter 7 is over, the Creditor will proceed against the co-signer personally.
Can I file a personal bankruptcy and not have it affect my business?
If you own your own business, the business is a part of your assets. If it is worth very much, it may be property of the Court. If your business files bankruptcy, it won’t affect you because the business does not own you.
Can Bankruptcy stop foreclosures, wage assignments, help me get my license back from an uninsured accident, stop evictions, a judgment, or remove a lien?
Yes.
What will happen to my bills?
When you file a bankruptcy, a Court order goes into effect that keeps Creditors from legally collecting from you. When you are discharged (i.e., the bankruptcy is final), the Creditor "charges off" the debt and gets a tax deduction for the loss. The bill is not paid, and the debt shows up as a bankruptcy charge-off on your credit report. Some Creditors will attempt to get around the law and will continue attempts to collect after the bankruptcy is filed. They can be sued for this, but you need to prove they did it. One of the best methods is to record their call and then surprise them in Court with it when they deny ever making the call. Most Creditors that ignore the law will never send you letters or anything on paper after you file, but they may make phone calls hoping that you will pay anyway.
What if I keep getting bills?
You will continue to get some bills from bankrupted debts after you file. What happens is that the Bankruptcy Court sends out notices to the addresses that you give to them (that is why correct addresses are so important), but some Creditors never get these notices and continue to bill you. You should make copies of your hearing notice. If you get a bill from a Creditor, send them a copy of the bill and the notice. Some Creditors will continue to send bills even if they receive notice. It may be that their computer can’t stop sending out the bills, or they may simply be ignoring the stay hoping that you will pay anyway. You can file a motion for contempt with the judge, and you may also be able to sue for a violation of the Fair Debt Collections Practices Act.
Do I have to pay my bills during the Chapter 7 or 13?
No. Don’t pay any bill until after you file a Chapter 7 until you have negotiated with the creditor to keep the property. Don’t pay any payment in a Chapter 13 unless it is the regular monthly mortgage payment or car payment, and the 13 was filed to catch up the arrearage. A stay is a federal Court order to stop. If the item is secured, your overdue payments will continue to add up while you don’t pay on the item. However, the Creditor can't take the collateral until the stay is terminated. If no reaffirmation is filed within 45 days after the bankruptcy is filed the stay terminates and the bank can take the car.
The Creditor may also file a motion to terminate the stay after the bankruptcy is filed. Bankruptcy stops your obligation to pay, but the Creditor still has a lien and rights in the property. You often quit paying for items when you file so that you have time to decide if you want to workout a repayment, redeem, or surrender. I have rarely ever had a bank refuse to agree to repayment, but you don’t want to make payments if they aren't going to let you keep the property. Singing a reaffirmation will make you liable for any deficiency if you have it repossessed later. In some rare cases, with people who are never going to repay, the bank may refuse to reaffirm. Some credit unions may refuse to keep a car or mortgage unless you also repay their credit cards. In cases like this, you may want to redeem property instead. That is why you don’t want to make payments just before or after you file. You can take the time to negotiate your options. You don’t have to be caught up on your payments to reaffirm, but some banks may request it—and all of them want it.
Who notifies the Creditors and bill collectors?
After the bankruptcy petition is filed, the Court mails a notice to all the Creditors listed in the schedules. This usually takes 1-2 weeks.
Do I have to go to Court?
Not exactly, but you will have to attend a hearing presided over by the bankruptcy Trustee. This hearing is called the 341 Hearing (Meeting of Creditors). At this hearing, the Trustee (who is an Attorney) will ask questions, under oath, regarding the content of your bankruptcy papers, assets, debts, and other matters. It is very much like a deposition, not like a trial. If you can’t attend (example: if you are in the service overseas), you can answer the questions by Affidavit. The Trustee is not the judge. He is there to take any assets from you, if he can, and to check the accuracy of your paperwork. The Trustee represents the banks—not you. In a Chapter 13 you will have a second hearing to get your discharge if your case was filed after October 2005. In this hearing you must show that you are no charged or convicted of a crime of fraud or further behind in support.
Where is my 341 hearing?
Your 341 hearing is always at the Federal Court closest to you.
What do I wear to the hearing?
Don’t wear cut-offs or jeans with holes in them and don’t wear sandals. Suits are not required, but dress properly for a hearing in Federal Court. Children are not supposed to be in the hearing room. Do not borrow and wear flashy jewelry. This is not the time to brag about how rich you are or how much you own. The Trustee is looking for assets to take from you. He is not your friend. He represents the persons that you owe. You must report what you own and it’s real value, but don’t brag about your income and how much your car is worth—especially if you don’t have any.
When should I file tax returns if I am going to file bankruptcy? If I file in December do I keep my refund?
If you are considering filing a bankruptcy, you must file your tax returns. No file returns…. no file bankruptcy. If you can get your refund before you file. If you do and spend it, you will keep your refund no matter how much it is. If you get your refund after you file bankruptcy, and the refund is over the exemption, you may lose part of your refund. File a quick refund if you have to or apply any refund amount to next year’s tax debt. If you are considering filing in the later part of the year, file before December. If you file in January, you may have to wait for some time after you get your refund back. You will be asked when you got your refund and how you spent it if you got a large refund.
Message Edited by Tuscani on 10-01-2007 12:47 PM

Can I pay some Creditors and not others in a Chapter 13?
You can’t (shouldn’t) discriminate and pay one unsecured Creditor class differently than other unsecured Creditors in that class. However Secured unsecured and priority debts are paid differently.
Should I try a Debt Counseling Service instead of filing bankruptcy? How do Debt Counseling services work?
"Debt Counseling Services" are often high-interest loan companies. Other times, they are agencies that pocket 10-50% of the monthly money that you pay to them as fees for their "counseling". Most of these services will combine your bills and send a partial payment to each bill that you owe. Your credit will be listed by the credit card companies as delinquent for sending in partial payments, and the reduced amounts sent in may not even cover the interest that a debt charges.
These "Counseling Services" are often simply rip-offs that pretend to be charities or helping agencies. If you pay a debt counseling service $100 a month, what happens is that they take up to $40 for themselves and then send your Creditors $60. Your bills fall even farther behind. Eventually, Creditors file lawsuits and you are forced into bankruptcy anyway. Very few of these "repayment plans" work and over 90% fail, leaving you worse off.
Another scam is that some debt counseling companies will charge thousands of dollars by promising to find you a consolidation loan as a loan broker or mortgage broker. These loans end up being at a high-interest rate or they pocket your money and never give you the loan. Others strip the equity from your home. Whatever method used, "Debt Counseling Services" are often scams meant to take your money when you are already in trouble.
Also be wary of using services that claim to “repair” your credit file. Some may attempt to create a new credit file by getting a new social security number. Changing your identity is a felony, especially if you steal another person’s identity. Creating a false identity and using it may also be a felony.
Admin note: Please also be aware of the following excellent information provided by National Foundation for Credit Counseling on what to look for when considering credit counseling:
How to Select a Legitimate Credit Counseling Agency
The last thing a consumer needs when struggling financially is to fall into the hands of an unscrupulous credit counseling agency. If you’re considering using a credit counselor, shop around, and ask each agency the following questions. More importantly, be certain that you are comfortable with their answers before you book that first appointment. A legitimate agency is always more interested in your bottom line than theirs.
Is the agency affiliated with a national body such as the National Foundation for Credit Counseling (NFCC) that requires strict quality, financial and ethical standards for membership? Examples of such requirements are annual audits by an independent CPA, written action plans provided to each consumer, and consumers provided with statements at least quarterly.
Is the agency accredited by an independent third party? Self-accreditation is not the answer you want. An example of a reputable third party accreditating body is the Council on Accreditation (COA). Such accreditation signifies that appropriate checks and balances are in place to protect you, the consumer.
Is the agency a 501(c)(3) nonprofit community organization? Being a nonprofit does not guarantee that the agency is legitimate, but it is a step in the right direction.
What is the composition of their Board of Directors? Board members should not be paid by the agency, should not be family members or friends, but should represent a wide cross-section of the community and civic interests.
What services does the agency offer? A wide-range of services is a good sign. This could include: budget counseling for those who are not in debt; debt counseling for those who may need professional assistance digging out; housing counseling for pre-rental, pre-purchase, first-time homebuyer, reverse mortgage, and foreclosure prevention; and the mandated bankruptcy pre-filing counseling and pre-discharge education.
What are the fees associated with the services provided? The agency should be forthcoming about fees, and no fee should be assessed prior to the service being provided. Be wary if the agency says their fees are voluntary. Any set-up fee or monthly fee should be reasonable, usually defined as $50 or less, with monthly fees in the $25 range. The agency should be willing to waive all fees in cases of true hardship.
What delivery options are available to you for counseling? Does the agency offer in-person counseling? Counseling by phone? Internet counseling? Is the channel that’s most appealing to you offered?
Is the counselor assigned to you a Certified Consumer Credit Counselor? You want someone qualified assisting you with your critical financial decisions. NFCC certification means that the counselor has passed a rigorous battery of tests measuring their financial knowledge.
Does the agency provide educational classes or workshops? Are any of these tools offered online? Is there a fee to attend? The absence of any true education offered to the general public is a red flag.
Will the agency work with all of your creditors? Some agencies only work with creditors who agree to make a payment to them. A legitimate agency will take a holistic approach to solving your financial distress.
Is there a minimum amount of debt required to be counseled? True credit counseling agencies will work with you regardless of how large or how small your debt may be.
What debt relief options are offered? If the only tool is the Debt Management Plan (DMP), keep shopping. A DMP is a useful tool, and is often the appropriate resolution. However, each consumer’s situation is different, thus the solution should be customized to fit their specific needs. A one-size-fits-all approach signals that you should continue your search.
Are the counselors compensated for writing DMPs? Any such incentive is not a part of a legitimate agency’s pay to their counselors.
How long will your counseling session last? Don’t be tempted by “drive-by” counseling. A counselor simply cannot do an adequate intake of your income, expenses and debts in a short amount of time. An initial session length of at least one-hour is standard.
If you go on a Debt Management Plan, how soon after receipt of your monthly payment will it be disbursed to creditors? The success of a DMP depends on timely, consistent payments to creditors.
What happens to your first payment? Believe it or not, some agencies keep the consumers first payment and consider it a donation. Be sure to ask about this.
Will the full amount of your payment be disbursed to your creditors? The full amount should go toward the repayment of your debts, with no portion going into the agency’s pocket.
How will your deposits be protected? Ask for written evidence that the agency is bonded or insured to protect the consumer from fraud or the agency’s own financial difficulties.
As a final step, check with the Better Business Bureau and your state’s Attorney General to see if there are unresolved complaints about the provider you are considering. Anyone can file a complaint. What is relevant is how the agency resolved it.
Legitimate credit counseling agencies counsel and financially educate millions of consumers each year, making financial stability a reality in their lives. It all starts with selecting the right agency. Asking the above questions, and receiving the right answers, will ensure that your credit counseling experience is a positive one.
How long should I keep a copy of my Bankruptcy?
You should keep a copy of your bankruptcy, with your tax papers, for at least 7 years. You will need them for any mortgage application but they are now filed electronically and available for download at any bankruptcy attorney’s office if you filed after October 2002. You are only required to keep receipts 3 years by the tax department—after 3 years they have the burden of proof—but keep tax and bankruptcy records for 7 years anyway.
When will I be able to get credit again?
Normally, you will qualify for a home mortgage at normal rates within 2 years if you let your home go back in foreclosure you will qualify in 3 years after the discharge of your bankruptcy. You will be able to get other credit within 6 months to a year. Your ability to get credit is based on your income and your history of repayment, as well as the security you offer. You should be able to purchase a car or house if you reaffirm one or two debts and pay for them on time after your discharge. You always have to be able to afford what you are buying on credit or meet credit standards. You will have to reestablish your credit by paying on time after your filing.
Will my employer and landlord find out about my bankruptcy?
Bankruptcy petitions are public records; however, under normal circumstances, no one will know you filed a bankruptcy petition unless you tell them. Chapter 13 Debtors are often required to make payments through wage garnishment, which means the employer will learn about the bankruptcy.
Will this affect my getting an apartment?
Many of the larger apartment complexes are owned by banks, and banks tend to grant leases according to credit bureau reports. This may affect you. Small landlords will call former landlords and may not check credit reports.
Can employers discriminate or fire me?
Generally no. There is an antidiscrimination section of the Bankruptcy Code that prevents employers or the state from denying you licenses or discriminating against you when hiring. But do yourself a favor: Keep it to yourself. They generally won’t know unless you tell them.
Are there bankruptcy crimes?
Yes. Criminal statutes related to bankruptcy can be found at 18 U.S.C. sections 151 to 157. Examples of bankruptcy crimes are knowingly and fraudulently concealing assets, lying under oath or on bankruptcy schedules, and knowingly and fraudulently filing a false proof of claim. Bankruptcy fraud can also be used to support a RICO claim. Bankruptcy crimes are often the result of claiming you don’t own property that you do own or that has been transferred to conceal it from the Court.
Do I have to disclose all of my assets?
Yes. If you knowingly and fraudulently conceal an asset from the Court, you have committed a felony and you can be fined up to $5000, imprisoned for up to five years, or both. However, this is rare and normally comes up in only the worst cases. In addition, the Court can deny discharge, or dismiss or convert your bankruptcy proceeding.
Can I run up charges on my credit cards just before filing?
The official answer is “No”. Many people do make some minor charges on their charge cards just before filing. Charges of over $1000 on any one card within 90 days before filing are presumed to be fraudulent and non-dischargeable. Luxury items of 500 within 90 and Cash advances of 750 within 70 days are non dischargeable. Charges to an account more than 90 days before filing are presumed proper regardless of the amount. But the rule that you can’t charge within 90 days of filing isn’t written in stone there are 12 factors that the judge will use to determine if it is fraudulent.
There is no reason to pay any further on debts that you are planning to avoid in bankruptcy. Normally, you should file as soon as you can, but it won’t matter if you pay the bills or not before you file. It doesn’t matter if you owed $10,000 or $10,000,000 before you filed or whether or not you paid on time before you file bankruptcy.
Message Edited by Barry on 07-11-2008 12:28 PM

Rebuilding credit

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