Who here has gone through a bankruptcy?

[snoozy]

Did it solve your financial problems? Where you able to save/protect your home? How does a bankruptcy work? Does the slate just get wiped clean or do you pay a percentage of your debts or how exactly does it work? What problems did having gone bankrupt cause afterwards?

[Gary in ohio]

Rules have changed in the last few years and the type of bankruptcy you declare will decide what you keep. For the most part with the new bankruptcy laws you dont get a clean slate. You will still owe some of your debts. Your home is not safe, you may or may not loose it. If you have a lot of equity in it you will most likely loose it to satisfy debts. If you have little in it you may get to keep it. Problems, Well, it will haunt your credit for a number of years and any future loans you will pay more interest on the loans you get.

Before you consider bankruptcy I would try talking to a debt consultant, usually free in many areas. Bankruptcy has lost its stigma as being bad but my opinion is it should be taken as a personal failure in ones life.

[kjmatson]

Chapter 7 and don't believe everything you hear about the "new" laws

[HermitJohn]

Originally Posted by Gary in ohio

. Bankruptcy has lost its stigma as being bad but my opinion is it should be taken as a personal failure in ones life.

If you follow the current great social plan, you should get a govt bailout and multi million dollar end of year bonus for failing...... Then immendiately hired to some other board of directors at an obscene salary because you have experience.

Oh wait thats only for those with an army of lobbyists in Washington......

[fellini123]

Well I know the rules have changed. But it used to be that yes you would get to keep your home and at least one vehicle. If you can prove why you need more than one you can probably keep both of them. Yes you have to pay off a percentage of your debt. That percentage is based on your income, the amount of debt and other stuff!!

Now I know nothing about the new laws and who is now eligable. It does screw up your credit for the 5 years of the bankrupcty and for 5 years after that. Now companies will say 7 years, but actually everything comes off your credit report in 5 years, there is no mention of anything after 5 years after discharge.

Alice in Virginia

[pinemead]

11 years ago, you could keep what you could pay for. If you could pay the house payment and a vehicle payment, you could keep them. Back then the bankruptcy showed on your credit report for 10 years.

[Drew Cutter]

I would talk to a bankruptcy lawyer . As far the home , do your homework on what the new laws on reducing your loans interest rates . Allot of people don't seem to know what their option are before the get their house foreclosed on. Check out Obama rescue plan for the homeowners. One of things people forget when they refinance there homes is their credit cards , student loans . Allot of people get over their heads in credit cards in addition to their homes.

[firegirl969]

Chapter 7, you don't pay off your debts. Chapter 13, you do pay a portion of your debt based on your income. Chapter 7 stays on credit 10 years. Chapter 13 stays 5-6 years. You can keep your house and vehicle with either. You can keep everything with Chapter 13.

[anniew]

I have a close relative who did bankruptcy within the last 3 years. He did NOT get to keep his home, so take all this advice as opinion, and get a legal opinion. Some of it depends on particular circumstances.

[Terri]

A 15 minute consultaion with an attorney is usually free. They tell you where you stand, and decide if they want your business.

Ask if a consultation is free when you call.

Although bankruptcy is in Federal Court, each state has it's own rules for what are exemptions to the law..do a google search for your state..i.e. chapter 7 bankruptcy in __________.

[wottahuzzee]

BK laws vary from state to state. In some states your house is untouchable. Get a consultation with a local BK attorney, maybe more than one, so you will know where you stand. The first consultation is usually free. A lot of people think they are experts. They are not. See a local BK attorney.

[tn_junk]

I am meeting with a Bankruptcy lawyer tomorrow at 10:00 AM.
I will post what he says tomorrow afternoon.
Will only apply to Florida, but should give some idea of what a
lot of people are looking at.

alan

[Oldcountryboy]

If at all possible, don't do it. I bankrupted in 2001 after loosing my job to extreme lower back pains and my wife was 7 months pregnant and couldn't work. Doctor put me on lifting restrictions which knocked me out of a job. Anyway I filed for bankruptcy protection. I got to keep the house which I owned and I kept paying on our vehicle since we only had like 1 or 2 payments left. But I bankrupted all the credit cards we had which was driving us insane with the amount we owed. $20K plus owed on them and they were eating us up.

But what's still killing me is that these credit cards are issued through a bank somewhere and they have the right to black list you even if you filed for bankruptcy protection. Which I found out the hardway last summer.

Hit another dry spot in my finances last summer due to no work available, high prices for gasoline, etc. My checking account got so low that I couldn't come up with the money to keep paying the service charge on it. So they closed it. Just about the time they closed it was about the same time I finally got some work and got paid a couple of really good checks. I took them to the bank to reopen my checking account and the bank wouldn't let me reopen or open a new account because I had filed bankruptcy back in 2001 and said I still owed them some $9000 something dollars.

So I said the heck with them, I'll go to another bank. I couldn't get a checking account opened with them either cause they run a credit check with other banks and if there's anything bad reported, your denied. Come to find out all banks do this now and if just one bank has something on you, your denied at all banks.

So there I was holding onto some large personel checks that I couldn't deposit anywhere. Or so I thought. The banks kept denying me checking accounts but what they didn't tell me was that I could open up a saving account with the money. This was my only way of depositing any money. I finally found out I can open up a spending card which is used just like a debit card. Only you don't get any checks with a spending card. If you need to send a check in the mail to anyone, you'll have to purchase a money order or cashiers check.

So, if you do file bankruptcy, be sure to keep your checking account up to date because if it ever gets closed, you'll have a hard time getting another one.

[Cindy in PA]

I thought that bankruptcy laws were like the old ones basically if you earn less than your state's median income. You can find what that amount is online.

[Lazy J]

Originally Posted by Gary in ohio

Before you consider bankruptcy I would try talking to a debt consultant, usually free in many areas. Bankruptcy has lost its stigma as being bad but my opinion is it should be taken as a personal failure in ones life.

Hear Hear, Gary!!!!!!!!!

I hear far too many comments like "Oh well, just go bankrupt and start over". Who do these people think pay for these bankruptcies? HELLO it is you and me, the ones that pay our bills and stand by our debts!

Of course if you have sicknesses or other catastrophic calamaties bankruptcy is a tool for you to use.

Jim

[DoubleBee]

Originally Posted by Gary in ohio

Before you consider bankruptcy I would try talking to a debt consultant, usually free in many areas. Bankruptcy has lost its stigma as being bad but my opinion is it should be taken as a personal failure in ones life.

I find this a little funny because we went a lawyer to find out what our best options were and even though we told them we'd be ok with trying to pay off the debt, they said you might as well be rid of it. She recommended we file for chapter 7.
We don't consider having to file chapter 7 to be any kind of personal failure. I am a cancer patient and we filed due to medical bills, and that was after we spent all our savings, and cashed out my IRA. All spent on medical bills, and we have good insurance! I wouldn't be so quick to judge because there but by the grace of God go you.

[Gailann Schrader]

Lazy J and Gary in Ohio.

You couldn't be more wrong. I'll leave it at that.

I have deleted my lengthy reply due to my class and high upbringing.


Snoozy. Have Faith, Do What You Can.

[MushCreek]

I had to file due to a business failure. I was able to negotiate a lower balance, and pay off all of my debts except a large machinery lease. The original lease was for $77K; I had paid $40K on it, and the shyster lawyers took me to court for $100K! I explained my situation and tried to negotiate, but the wouldn't take a penny less, so I filed. They got zero, zip, nada. Here in FL (at the time) they couldn't take your house, and you could keep $1K worth of vehicles, and $1K worth of personal possessions. I had a credit card 2 years after, and my credit is pretty decent now, although the B/K will always be on there. Since I don't plan on ever borrowing much for the rest of my life, it's no biggie. My wife's credit was unaffected, since she wasn't on any of my business loans. BTW, I went B/K due to foreign competition, since our brilliant g'ment didn't see any harm in doing a little trade w/ China. If that's a 'personal failure', well, then I guess I'm guilty.

[kjmatson]

My second post was deleted because I got a little fired up about this one. I will reply that I do not agree with Lazy and Gary. Statements like the ones they made are very open ended and bankruptcy can be due to serious medical problems and job loss as well. Don't be too quick to judge; it is very easy to say "we pay the bills they can't" however, you need to realize that there are very hard working people out there in serious trouble who need help.