Is bankruptcy so bad? How hard is it to get credit cards or loans after a bankruptcy?
I don’t want to file bankrupcy, but I have been unable to find a decent job for the past 8 months. I’ve had to use my credit cards for things like groceries and gas. I can no longer make my minimum payments, although I can pay a small portion. Further, I have been accepted to graduate school but I might not be able to afford it unless I file for bankruptcy or only pay a portion of my minimum payments. I have researched bankrupcty and the alternatives, but it seems so hard to get objective advice. Most information sources have a vested interest in the topic. Some claim that a bankrupcty will make it impossible to obtain future credit and prevent you from getting a job. Others claim it’s not so hard to get credit cards or loans. I know a bankruptcy won’t be fun, and I feel terrible to be considering it, but I’m wondering whether it’s really as bad as everyone thinks it is. Can anyone give me some advice or direct me towards an objective source of information? Thank you.
I had a chapter 7 Bk 7 yrs ago – all my credit cards are over 20% int rates, although I did get 3 mortgages – 2 at good rates, the 3rd is a 2nd mtg for new windows on my primary house, 2nd is for a rental property I bought – took 5 yrs until I qualified for a Mtg, of course I got a good job and promotion/big raise in between also, 2 yrs after BK, got a car loan, but very high rate and it took a couple of days until they found someone willing to finance and it was only a 10,000 car loan
December 15th, 2009 at 4:48 amCertainly not impossible to do any of those things, but for a few years afterwards, you’ll have a hell of a time getting loans. If you’re in too much debt to pay off within a few years and/or it’ll help your future earning potential, then it’s certainly not a terrible idea. I don’t know your exact situation so I won’t tell you yes or no, but I will tell you that "impossible" certainly doesn’t describe it, and it’ll hurt your chances of getting loans much more than your chances of getting a job.
December 15th, 2009 at 4:48 amIf you should file for bankruptby, I would suggest you get at least a secured credit card BEFORE you file to begin reestablishing your credit.
December 15th, 2009 at 4:48 amI have a bankruptcy ( the tail end of raising three kids single) from 2000, and yes, I am having a tough time getting credit, and had to start with a secure credit card. It has been a long tough road of mostly waiting, but I am getting there.
In my experience there are two types of Bad Credit Credit Cards. One is a secured card, and the other has a much higher rate of interest. Both can be used to rebuild your credit worthiness after getting back on your feet. Secured credit cards are great for rebuilding your credit. You send the credit card company a pre deposit amount set by the company.This amount will be equal to your credit limit. Pay over<!–your minimum every month and send your payment in before the due date and you will build your credit up gradually. Never miss a payment, be late on a payment, or go over your credit limit even by a small amount.
http://best-loans.awardspace.com/credit-card-for-people-with-bad-credit.htm
http://bestcreditcards.freehostia.com/
You don’t want the company to ever have to take from your pre deposit amount because they want you to handle your account just like you would an unsecured card. A great thing about this pre deposit amount that you send in is it can act as a savings account even earning a little–>bit of interest for you. After establishing yourself with the credit card company, they may decide to give you a unsecured credit card or increase the limit on the one you have with them without having to make another deposit. Secured credit cards are a good choice for anyone wishing to rebuild their credit history.
December 15th, 2009 at 4:48 amCheck out ‘The Truth about Credit Repair’:
They have lots of free articles and videos that may answer most of your questions.
http://www.gmigllc.com/credit/creditsecretsbible.php
December 15th, 2009 at 4:48 amBankruptcy with the new laws require you to qualify per the new means test, based on median household income, and taking a credit counseling class which isn’t hard at all. I filed last year, a chapter 7. I have an unsecured credit card that was offered 2 months after my discharge. I pay it faithfully. I was just approved for a brand new harley davidson motorcycle and am current and pay faithfully on all my bills. I had a divorce, which left me no choice but to file. I am re-establishing my credit now and with making my payments on time and even before the due dates, I will re-gain my good credit history. The downside to a bankruptcy…if you work in the credit field or accounting field, it’s tough to get a job in that field if an employer checks credit. Some do, others don’t. Filing for a bankruptcy could put a damper on getting a school loan, so unless you plan on paying cash, it’ll make it hard to get an grants or loans to put you thru the schooling… Is it as bad as everyone states, no…..I have an excellent job in the credit field, I work fulltime, make great money and will get back on my feet, it’s just going to take hard work and financial control….but…had I had the chance….I never would have filed, but..with no income at the time, I had no choice….check this website out..it’s excellent for debts, credit and bankruptcy info…www.bcsalliance.com…..gives you alot of pros and cons for a bk.
December 15th, 2009 at 4:48 amGood Luck!
Many people are facing the possibility of filing for bankruptcy. Sadly, many people who are in this position have been given bad or poorly explained credit advice and are wondering if there are any other alternatives to going down the bankruptcy road. There are options available to keep your good name and pay your debts.Check this good resource i found in the web about alternatives of bankruptcy – http://www.badcreditresources.com/say_no_to_bankruptcy.html
December 15th, 2009 at 4:48 am