Yep, I'm with you Dave! For paying them all back, you get a bite in the ***. Do what's going to work for you. They made the system, we have to live with it. There are people on this board with bk's still on their reports, with scores higher than mine also.
Ch 13 only stays on for 7 years provided it gets discharged (payed off) by then. Ch 11,7 will stay for 10 years.
You hit the nail on the head--pay people late--you get bit in the a**--over and over--matter of fact, I got permanent teeth marks-- breeze, I only wish this board was available back in 1993--had I known then what I know now--it boggles my mind... Cheers, David
einzige, I think it would be helpful to know a little more about your situation to give better advice. How close are you to graduating? I guess by your age that you will graduate in about May 03. That would only be ~14 months of interest payments for the cards. I think the pre-graduation period is the one you should focus on. Without the car payments, how much money do you have after you basic expenses? It really sounds like without the job and only school loans, you are running negative before credit card payments. Also, where are you at in terms of you credit limits? I'm guessing maxed, but if not that would make a huge difference. To my mind, the only reason you should consider either BK or charge off is that is the only way you can see finishing school.
After a few years, if you're smart and rebuild properly, it doesn't matter. Read Marie's post. She has a bk still showing - her score is higher than mine - I have no bk showing. Only file 13 if you don't qualify for 7.
First the Facts: IF YOU ARE USING FEDERAL LOANS.. CH7 Will NOT effect your eligibility. I BK7 at age 22 with about the same amount of liabilities you have. I did it most of all to protect the job I had because creditors were calling left and right. I turned in my car, saved up bought another one cash and paid for everything cash. It wasn't so bad. Whatever you do don't quit school. You can get the max federal aid and student loans and live off of them. You could probably get a $2k Honda/Toyota to get around in with one of your loan checks. Soon I will graduate (undergrad) and I've been worrying about the Ch7 on my reports. Actually it will be the ONLY negative entry on my reports after I graduate. I'm going to try a round of disputing, maybe I'll be blessed. If the entries stay I will tell a potential employer I was "young and dumb". About CH7 wrecking your life for 10 years. I dont think so. I'm saying that mostly because of other's experience. I've known three people to get cars 1 month after filing(2 new/1 used). You can get decent rates on mortgages 2 years out. From my personal experience my interest rates and limits are comparable to my " good credit contemporaries. The hell with that moral crap. Look at GW, Dick and the Enron scandal. Look at all the corporations that go under each month. Think they don't have creditors. Think they care about consumers.
and you forgot to mention the S&L scandal of the 80's. We paid for that, they kept their condos in Florida and their bungalows on St Thomas.
File BK if you have to. It doesn't affect your score as bad as you think. You will have to pay for everything for awhile but not forever. Otherwise, let them charge off. That's what I did. I had 3 accounts that charged off. And I'm still trying to get 2 off but I am happy with the progress I've made so far. I think employment wise, a Ch.7 BK is better than charge offs. When I first graduated college, I applied with a local bank and I just kept getting the run around and voice mail. So, I figured they weren't interested in me. Come to find out, when I pulled my credit report they had looked at it and never even told me. Alot of employers are using credit in a decision to make a job offer. Either way, don't quit school to pay off debts. I don't feel bad for letting the accounts charge off. It was only about $4k total. I just paid cash for everything for about 2 years until I got a cap 1 card. Decide what you're going to do. Ask questions and get opinions if you want. But under no circumstances should you quit school just to pay off credit cards. An education is too important.
Now I'm at a toss up...BK or just letting it go and getting on with my life (and not building up anymore debt). I have 2 credit cards, one with $3000 and one with $3500 limits. the $3000 is citibank and maxed out and the other is not maxed out yet. These are mostly from paying to get my car fixed, dental work, and stuff here and there that added up over time. I generally was not frivolous with charging, but it did get out of hand. I cut up both cards and only use my Visa check card. I have about 3 years of school left, because I took some time off after I graduated high school. When I wasnt in school, I pretty much lived pay check to pay check using $ for food, bills, car, credit card payments etc and never had extra cash left over. I also have a few utility bills from an apt I had where my roomate left w/out paying her share. I do qualify for the maximum amount of financial aid, and combined that with a part time job (as of right now i am awaiting determination on an unemployment filing) I dont get any monetary support from my parents, or anyone else. As for the car, I just plan to let the bank take it back as a voluntary repo and fix up a used car my dad has. Right now I live in a dorm so I don't have additional expenses, but I do plan on getting an apt next year. My concern with school is I am an international studies major and plan to go abroad eventually. I don't want any outstanding debt preventing me from being able to have an internship (because they are usually unpaid, how would I be able to pay my debt then?) or travelling. can credit card companies sue me for not paying back $3000 (each card)? what can they do? how much does it cost to talk to a lawyer and file chp 7?
I tend to agree with Lizardking. Having said that, I have two comments. First, if you decide to default on everything except one card (so that you have some available credit), it will catch up with you. They all do AR's and when the good card sees you defaulted on the others, they will cancel you. This is a minor problem, but something to be aware of. Second, I read where 80% of high school graduates who go to college and eventually graduate, do not graduate within 4 years. There is nothing to say that you cannot take one year off to rebuild. My son, now 20, took one year off after high school before starting college. He worked two jobs, one full time and one part time, and saved $12,000 during that year. Now he pays as he goes - no student loans, no borrowing. At least think about the possibility of taking a year off. Like I said, I tend to agree with Lizardking but am throwing this out as an option. What he did was nervy, and not for everybody, but it sure beats bankruptcy.
(Karen, It sounds like you brought up a really responsible son - Great Job! ) I still say that I wish that I'd filed bankruptcy back in 1997 when all the "S" hit the fan. I say this only because I know of people that did this after that date and they all have started over, own homes already, etc. But I guess the danger of that is it may affect you in your job search later. What our nice member with the should do, is sit down, read all the advice here - yes, a lot of it is conflicting, but it is good to get different opinions. Then make an informed decision. Good luck whatever you do!
