Topic: New to this, all advice welcomed on upcomming BR

[ann9787]

Hi,

I recently filed for chapter 7 and my court date is this Thursday.  There's so much information here that I'm a little confused as to where to start.  My current fico score is 497 - Hard to believe that two years ago it was 790!  To say I've had a run of bad luck is an understatement and just two days ago I totalled my car that I was planning on keeping and paying off over the next two years.  Now, I'm sure if anyone finances me, I'll get an ungodly interest rate. 

What is the best way for me to start improving my score so that it begins to go up in the shortest amount of time?

I'm considering just renting a car for a few months or at least until I can get my score up to 550 where I can get 15% interest rate as opposed the the 28% rate I would probably get now.

Any help would be greatly appreciated, thanks in advance!

[foolsmission]

First Step
Get Real direct from each of the 3 CRA reports. Hardcopy through US Mail.

The score you mention, is it FICO vs what we call FAKO?

As for a car does your career require it be nice i.e. Real Estate Agent ect?
I'd think about a used toyota or honda. A few months of rental charges could go to a reliable car if you have the ability to cherry pick one that has had regular maintence performed. Many people are overly concerned with mileage. I'd rather drive a 150,000 mile car that has had proper fluid changes than a 70,000 one that has not.

You'll be looking for "rebuilder" cards for a while.

Do you have the ability to keep open any of the accounts so you have some age to your credit file?

[ann9787]

HI,

The score I got was FICO, I went to fico.com to obtain it.  My career does require a decent vehicle (I'm an interior designer).  Regarding my accounts, I owe ALOT on and can't see keeping any open since I can't pay on them.  The only one I could have kept open that was decent was my auto loan and that's history now with my car being totalled.  I'm wondering if I could just cancel the chapter 7 and try to just clean my credit up without going into BR.  I know that the BR will show on my credit but I would think that would be easier to have removed eventually.  I'm pretty much judgement proof at this point since I don't own a home or have any assets.  It's been over two years since I stopped making payments on my credit cards.

I filed for chapter 7 thinking that my credit would be better in two years than if I did nothing or even tried to pay on any of my debts.... I  just don't know what to do other than cry my eyes out at this point!  I owe about $48K but not all of it is listed on my credit report.  About $25K is showing, all credit cards and one judgement.

[Rottweiler]

If you have not paid any of your non-essential credit accounts in two years, and you have a judgment against you, and can qualify for a no-assets BK 7, that is the best thing for you.  And, that is what it sounds like here.  The reason I would go for the BK is the judgment...which will come back to haunt you should things get better.  And, they will.

If it were just the charge-offs, at this point, it is highly unlikely that the accounts are still with the OCs.  I'd bet--unless we are talking a very few OCs, such as CapOne--that they have been in the hands of at least ONE JDB by now.  So, if they did come after you, they could be defeated on the lack of documentation alone!

[ann9787]

Rottweiler:

The judgement is for $2,500 so it's not that huge of an amount....... I'm pretty sure all of my CC accounts are not with the OC at this point as there are all kinds of collection accounts listed on my credit report.  I'm just wondering what my chances are of successfully disputing these accounts in hopes of raising my score and if that would be better for me than going forward with the BR???

I only have a few days to figure this out....

[Rottweiler]

Your chances of disputing the accounts, successfully, with CAs/JDBs is not good, even if you had months or years to do it!  With only a few days, you have no chance of all trying to raise your scores by disputing the TLs, or trying to get them deleted.

Going BK7, while it hurts a lot in the short run, will probably not hurt you as much because your score is so low already.   Also, you can rebuild your credit from a BK easier than if you were to try to avoid it entirely.  And, this would also prevent even more judgments from being taken against you...which may very well be in your future if you don't go BK.

And, there is NO shame in going BK:  It's a business decision!  Just as the creditors made a business decison to loan you the money, and then to sell the defaulted, charged off accounts to others, it is a business decision for YOU to declare BK when there is no reasonable chance of paying them back.

[bmslaughter]

Once you file the bankruptcy it is reported to the CRA's by the court. If you withdraw now, I believe that notation would remain on your CRA's although it would be notated as dismissed and not discharged. I know my Chapter 7 was on all 3 of my CRA's within 10 days of filing. Don't worry--if your scores are already that low you won't see much more of a drop. Mine only dropped by 10 points when the BK was added to my reports. You may have to get approval from your trustee to finance another car--which usually isn't a big deal cause most of us HAVE to have a car to be able to work. Finding a lender while you are in BK process is another matter. When you talk about your court date, does that mean you have already had your creditors' meeting?

You may already be aware of it since you went to Fico (myFico.com?) to obtain it, but there are 3 FICO scores--one for each CRA. I would strongly recommend that you obtain all 3 of your FICO scores($44.85)--the scores can be grossly different between the 3 CRA's. I would then interview creditors and only use the ones that use whichever of your FICO scores is higher. I have an 80 point spread between my highest and lowest score. I also would not wait to start disputing items. Only 2 of my creditors have notated my CRA's "included in bankruptcy" so far. And I have, since Oct 26 this year had between 5-7 negative entries removed from EACH of my CRA's. There is nothing in the bankruptcy law that says you cannot dispute items on your CRA's. Maybe some of the items I have had removed will show back up--but maybe not. If they do, I will just dispute them again.
BTW, if one of the CRA's should ever send you a letter asking for copies of your BK papers listing your creditors--DO NOT SEND IT IN!!! If you do that they will mark every single one of your creditors listed in the BK as "included in bankruptcy". That will make it very difficult to dispute any of those items if not impossible because you will have verified the debts yourself by providing that documentation.
Good luck

[foolsmission]

See
http://www.whogavemecredit.com/
http://finance.groups.yahoo.com/group/creditpulls/database

[Flyingifr]

My take - the BK will do little to hurt your credit because the damage has already been done. It will get rid of the creditors, though and through judicial (read that both as "wise" and "in the Courts" use of FCRA and FDCPA you can do waht I did and bring suits against your now former creditors to get removals of trade lines.

[ann9787]

Rottweiler and Bmslaughter:

Thanks so much, I really appreciate your input.  I suppose I will forge ahead at this point with the BR and do what I can to improve my credit from this point on - I've lived the past two years without credit and it hasn't really affected me much.

I am confused about one thing Bmslaughter, I thought "included in Bankruptcy" was something you wanted to see but it sounds like that's not a good thing....  I'm confused about the whole post BR, cleaning up your report thing.  Can you point me in the right direction here so I can understand that aspect better?  THANKS SO MUCH

[Rottweiler]

Ann:

Read Flyingifr's post again...you will be in a much better position once those creditors are off your back, and that judgment is vacated, than you would be if you don't declare BK.  You can deal with the trade lines later.

And, it won't kill you to go through BK7.  I did, in 1991.  The peace of mind in getting the meanies off your tail, once it's clear you cannot deal with them effectively any other way, is worth it.

[bmslaughter]

On the trade lines you are unable to get deleted--Yes, you want it to say "included in bankruptcy". And make sure that any creditor who adds that notation resets your balance to Zero. Also watch the dates they put--it should be the same as your BK date--they will try to get away with putting the date they received the notification from the court.They will do almost anything to keep it on your CRA longer!

I would try to dispute the CA's and collection accounts first if they are not notated. I filed my chapter 7 October 13. The public record is on all 3 of my CRA's. Only 2 of my creditors have put the notation "included in bankruptcy" on my reports. Two of the collection agencies 'verified' to the CRA when I disputed--which actually puts them in violation right now because when they verified they did not notate the BK and left the balances the same. If I cannot get them to delete(I have VOD'd them) I will bring their violations to their attention.

The problem with the "included in bankruptcy" notation is that it makes it very difficult to dispute since you essentially claimed that debt as yours when you listed it on your BK. The other thing to consider is that your BK effective date is more recent than the date of your last payment----When the "included in bankruptcy" is notated that resets your 7 year period to the date of your BK--NOT what you want! It makes ALL of your negative accounts look recent. I had a large charge off $15,000 that was several years old--the minute the "included in bankruptcy" notation was put on it  my FICO scores immediately dropped --up to 53 points. Due to the recent notation, I suppose. Originally, my scores had only dropped 10 points from the public record of the BK being entered.Now, from disputing, my scores have risen 30 points from the lowest score and about 70 points on the highest--just since I began disputing Oct 26th--and AFTER that 53 point drop(that score is now higher than when it dropped 53 points).

Don't forget--when the BK is discharged you can always dispute it too. You never know if the court will be back logged. Some people say you shouldn't do that cause you DID file-and I did at one time too. but after seeing the unethical things THEY have done to me and others--I say make them work and prove every single negative item on those reports. And you do not have to respond to any letter from the CRA wanting information that could be used to verify a TL.
Keep reading this site. These guys on here are great! They have given me lots of sound advice.

You can also check out http://www.lifeafterbankruptcy.com/ Also a good source for people recovering from BK--and no, you really don't have to buy any of his stuff. He has a newsletter, tips, and you can even email him a specific question(may take a few days though)
Beth
BTW, so far: 5 Neg deleted from Transunion, 9 from Equifax, and 9 from Experian--only 50,000 more to go! LOL hahahahha

[ann9787]

Wow, thanks for all the info everyone.  You've all been extremely helpful and I will read all of the information here, thanks!