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File Bankruptcy?


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Question 1: Has anyone here filed Chapter 7? I have no assets except for my weekly pay check. No home, Leased vehicle, no money in checking or savings. I talked with a bankruptcy lawyer and he said it should be a straight Chapter 7 and he files 20-30 a month.

Question 2: If you have already filed and the whole process has gone thru and you have tried to apply for credit anywhere, how hard was it to obtain new credit. I am concerned about when I try to get car insurance, electric and phone service and when I try to get a new car lease or loan.

If you have been thru this and wouldn't mind sharing your experience I would appreciate your advice. Thanks.

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Okay...question 1. Been there, done that.

Question 2. Depends. If you have a job and/or source of income, you should be okay post BK 7. Car insurance may go up a bit at renewal time. You'll be able to get "secured" credit cards within months, and then new CC within a year or so (but, of course, we've both learned our lesson about doing that). Renting a new apartment may be a problem if you deal with a big rental company...if you rent from a small operation, you should be okay. Utilites...no sweat, although they may want a security deposit again. And...within weeks of your BK being disharged, you'll begin to get offers for "high credit risk" car loans.

So...bottom line...if you have a job, BK 7 makes life a little easier for you afterwords, as long as you avoid the credit traps again.

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1) Yes, 10/04.

2) Not as bad as I thought. I followed the sugestions of this site and I am working on rebuilding credit now.

things to keep in mind-

BK does nothing for you except wipe the slate clean. The underlying issues/reasons why you are in the current situation are not addressed unless you confront it head on. IMO, for most people (myself included) its not salary but spending habits that need to be reworked.

See a good attorney. Its worth the money. You are doing this once (hopefully) in your life. Get it done right.

Make sure your car situation is taken care of before filing. I refuse to have a car payment for the next 5 years, so I sold my more expensive truck and bought a Civic with cash, saving me almost $800/month (gas, insurance, no payment). I don't particularly like driving it, but the free cash every month gets dumped right into my Scottrade account. My car insurance alone went from $2600/yr to $820/yr. The company I am with did a check credit as a new customer, but never again. So maybe switching insurance companies isn't a good idea after BK.

Getting credit again- hasn't been a problem YET. I have four new credit cards and a secured installment loan. The CCs are definitely subprime, but they are building good history. I know down the road I am going to have problems with mortgage and all, but by then it will be seasoned so I'll deal with it. I have heard that future landlords may deny your app or make you put down a few K to rent new apartments, so you may need to start saving. But keep in mind, when you have little to no debt, its easier to save if you are on a tight budget, which is strongly recommended.

Good luck!

10/26/04 FICO 492/567/461

03/07/05 FAKO 640/634/627

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I am currently waiting for my discharge....

i also recently got car insurance with geiko and it was very reasonable! i pay about $460.00 a YEAR.....i have a really clean driving record but my credit is horrible.

this was by far the lowest rate i got from anyone.....thay are also friendly.

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