Personal bankruptcy

[rayne89]

Ok, as depressing and humiliating as it is hubby and I have figured the only way to get out from this massive debt we have is to file for bankruptcy. My phone rings off the hook and now they are calling my parents and in-laws. :crying:

So I’ve not a clue on how to find a reputable attorney or what expect. Does anyone have experience in this area?

Thanks.

 

[Princess_Abby]

You might want to find a NON-PROFIT credit counseling agency that can refer you to a good attorney in Michigan for bankruptcy.

Just an idea. They probably refer out quite a bit and have good working relationships with these attorneys, but don’t directly profit from referrals either way.

 

[wabrams]

Credit counseling will damage your credit worse than bankruptcy. You would probably want to file a Chapter 7 that will wipe out your debt. A lawyer will be able to lookm at your total financial picture to help determine the best method, but Chapter 7’s are the most common.

 

[wabrams]

Princess_Abby:

You might want to find a NON-PROFIT credit counseling agency that can refer you to a good attorney in Michigan for bankruptcy.

Just an idea. They probably refer out quite a bit and have good working relationships with these attorneys, but don’t directly profit from referrals either way.

They compete against each other, not work together.

 

[Princess_Abby]

wabrams:

They compete against each other, not work together.

Um…oh.

Sorry, Rayne! I’m just a young kid who didn’t have a credit card til she graduated college!

 

[wabrams]

It would kinda be like a credit union recommending you go to a bank to get a better deal. Credit unions are non-profit, but we all know banks love that bottom dollar!

Credit counseling hurts your credit more than a bankruptcy b/c you run into the problem of payments not made on time, it takes longer to pay off the debts, etc.

 

[Princess_Abby]

wabrams:

It would kinda be like a credit union recommending you go to a bank to get a better deal. Credit unions are non-profit, but we all know banks love that bottom dollar!

Credit counseling hurts your credit more than a bankruptcy b/c you run into the problem of payments not made on time, it takes longer to pay off the debts, etc.

whew…thanks, Mr. Finance

 

[wabrams]

Princess_Abby:

whew…thanks, Mr. Finance

You’re more than welcome. If you have anymore questions, just let me know! I’ve been in finance/sales for about 7 years.

 

[auppie]

wabrams:

Credit counseling hurts your credit more than a bankruptcy b/c you run into the problem of payments not made on time, it takes longer to pay off the debts, etc.

I don’t know where you are getting this information; it simply is not true. We went through credit counseling, they negotiated with our credit card companies and got the interest rates lowered or terminated, our total outgoing payments were lower, and it did NOT take longer to pay off the debts. They were paid off with in 5 years of beginning the program. During our time on the program, we were able to purchase a house, which would not happen with bankruptcy. Since there was a consistent and on time payment history, we experienced no credit problems.

We chose the option to have the monthly payment debited directly out of our checking account, so payments were on time, then when one debt was paid off, we didn’t change our payment amount, and just applied that amount to the next bill that was closest to being paid off.

I would try with the credit counseling centers before thinking of bankruptcy.

 

[Scanner]

Find a reputable lawyer quick - they are chaning the laws in favor to the credit card companies and banks (thanks Bush and Republican Congress - can always count on you to know which side you are on!)

 

[kaymart]

I honestly don’t know the laws now but in 1986 we filed for bankruptcy and it was the best thing we ever did. We were so in debt back then I had to work, my husband had 2 jobs and two little children (youngest not born yet for 2 years) One note…throw out all the little “come-on” offers to restore your credit. They hound you like crazy. Use cash only policy. (except house and car of course) even with cars 2-5 year old cars are just as good as new ones. We have been doing OK for almost 20 years now and I been a stay-at-home mom and hubby works one job!!! Good luck

 

[rayne89]

How does one find a reputable lawyer? I mean I don’t feel comfortable just flipping open the yellow pages. Thanks!

 

[auppie]

rayne89:

How does one find a reputable lawyer? I mean I don’t feel comfortable just flipping open the yellow pages. Thanks!

Try referrals from friends, family, business acquaintences. There are some referral services.

Go to the library and look at lawyers in Martindale Hubble’s books…they have listings of lawyers along with “grades” of the lawyers.

 

[wabrams]

auppie:

I don’t know where you are getting this information; it simply is not true. We went through credit counseling, they negotiated with our credit card companies and got the interest rates lowered or terminated, our total outgoing payments were lower, and it did NOT take longer to pay off the debts. They were paid off with in 5 years of beginning the program. During our time on the program, we were able to purchase a house, which would not happen with bankruptcy. Since there was a consistent and on time payment history, we experienced no credit problems.

We chose the option to have the monthly payment debited directly out of our checking account, so payments were on time, then when one debt was paid off, we didn’t change our payment amount, and just applied that amount to the next bill that was closest to being paid off.

I would try with the credit counseling centers before thinking of bankruptcy.

First off, how long ago did all this happen?

Second, you’re one of the few that have a successful experience with credit counseling. 5 years is a lot longer to pay your debts off than the 2 to 5 month process of a Chapter 7 bankruptcy. And yes, you can buy a house 1 day out of bankruptcy. Credit couseling affects your credit the same way a Chapter 13 does: it shows you cannot manage your debts and now you’re having to repay them at a negotaited amount w/ someone elses help, regardless of the fact if it is paid on time or not. Trust me, I work with people regularly who are in this situation for the last several years versus one person who has been in it one time.

 

[wabrams]

kaymart:

I honestly don’t know the laws now but in 1986 we filed for bankruptcy and it was the best thing we ever did. We were so in debt back then I had to work, my husband had 2 jobs and two little children (youngest not born yet for 2 years) One note…throw out all the little “come-on” offers to restore your credit. They hound you like crazy. Use cash only policy. (except house and car of course) even with cars 2-5 year old cars are just as good as new ones. We have been doing OK for almost 20 years now and I been a stay-at-home mom and hubby works one job!!! Good luck

The biggest differences are that you can’t include federal loans (i.e. student loans) or medical bills. As far as lending goes, you can buy a car or refinance just a day out of bankruptcy (though the rate isn’t that good). And the nice thing is in 7 years, the bankruptcy drops off your credit report!

 

[auppie]

wabrams:

First off, how long ago did all this happen?

Second, you’re one of the few that have a successful experience with credit counseling. 5 years is a lot longer to pay your debts off than the 2 to 5 month process of a Chapter 7 bankruptcy. And yes, you can buy a house 1 day out of bankruptcy. Credit couseling affects your credit the same way a Chapter 13 does: it shows you cannot manage your debts and now you’re having to repay them at a negotaited amount w/ someone elses help, regardless of the fact if it is paid on time or not. Trust me, I work with people regularly who are in this situation for the last several years versus one person who has been in it one time.

We just finished with the program this year. Yes, it is a longer time to repay than it is for the process of Chapter 7, but we paid it off. The bankruptcy stays on the record for 7 years.

I have to disagree with you that the credit counsleing affects one the same way Chapter 13 does. I don’t believe it says we can’t manage our debts…I believe it says we having terrible difficulty with these debts, we want to pay them, but don’t want to declare bankruptcy, and we would like assistance with negotiating the interest rates because the credit card companies won’t work with us. These debts were our responsibility that we did not want to blow off, as most people do with a bankruptcy.

My co-worker filed for bankruptcy before she moved to Colorado, and she does not qualify for a house loan, car loan, etc. because of her bankruptcy. She is finding life difficult because of her bankrupty.

 

[auppie]

wabrams:

The biggest differences are that you can’t include federal loans (i.e. student loans) or medical bills. As far as lending goes, you can buy a car or refinance just a day out of bankruptcy (though the rate isn’t that good). And the nice thing is in 7 years, the bankruptcy drops off your credit report!

Any negative information on your credit report that is 7 yrs old or older, can be removed as well.

 

[wabrams]

auppie:

Any negative information on your credit report that is 7 yrs old or older, can be removed as well.

Only 7 years AFTER they have been paid off.

Actually, I was mistaken: Bankruptcy’s (can depend on the state), judgements, and tax liens stay on 10 years after they are paid off. Creditors pretty much disregard all of them after the paid date is 2 years or greater.

 

[wabrams]

auppie:

We just finished with the program this year. Yes, it is a longer time to repay than it is for the process of Chapter 7, but we paid it off. The bankruptcy stays on the record for 7 years.

Congragulations!

auppie:

I have to disagree with you that the credit counsleing affects one the same way Chapter 13 does. I don’t believe it says we can’t manage our debts…I believe it says we having terrible difficulty with these debts, we want to pay them, but don’t want to declare bankruptcy, and we would like assistance with negotiating the interest rates because the credit card companies won’t work with us.

You can think that all you want, but 99.99% of all creditors/lenders and the credit bureau’s don’t see it that way. Most of what you just typed says “we mis-managed our debt and we can’t get out of it on our own, so we need someone to help us out;” basically what I said. There’s no shame in it, but please try to make it something it isn’t.

auppie:

These debts were our responsibility that we did not want to blow off, as most people do with a bankruptcy.

Hey, like I said, congragulations for getting yourself out of that situation. Personally, I would rather file the Chapter 7, be done with it, and start repairing my credit now.

auppie:

My co-worker filed for bankruptcy before she moved to Colorado, and she does not qualify for a house loan, car loan, etc. because of her bankruptcy. She is finding life difficult because of her bankrupty.

Well, did she file a 7 or a 13? Did shea file on to start with then re-file for the other? If it was a Chapter 13, did she make all her payments on time? Did she try to re-establish her credit afterwards? Did she follow-up w/ the credit bureau’s to make sure all the info was accurate?

I’ve seen more people in or just out of credit counseling have problems getting financed than I have out of Chapter 7 or 13.

 

[wabrams]

Auppie,

I’m really curious as to which lender you used to get a home loan while still in credit counseling. Who you mind sharing that with me? It could be really useful in my line of work.