In most cases Bankruptcy does NOT hurt your credit!
Not paying your debts is what hurts your credit.
If you CAN pay all your bills…you should pay all your bills.
If you CANNOT pay all your bills…
….if you are borrowing from Peter to pay Paul,
….living paycheck to paycheck,
….stuck making minimum payments
….and trapped in an endless cycle of debt.
Think about it.
Your credit is already messed up, maxed out, or dead.
And if your credit is already messed up, maxed out, or dead
….The truth is… bankruptcy can’t hurt it.
Want Good Credit?
If your credit is already messed up the first step to rebuilding credit is to get rid of some debt.
And the fastest way to get rid of some debt is to file bankruptcy.
Call today for a FREE Debt Consultation.
Call toll free (800) 209-4529.
Think about it.
If you want to re-build credit, where would you rather start:
- Your credit is messed up and you still owe all your creditors, or
- Your credit is messed up and you DON’T owe all your creditors.
The second option, of course, is the only logical choice.
Most likely, if you are reading this page, the first option is your situation now. You know what the second choice is? Bankruptcy. Yes, bankruptcy. If your credit is messed up and you can’t pay all your bills, bankruptcy can’t hurt your credit. But it can eliminate debt. And getting rid of debt is always the necessary, first step in re-building credit. And bankruptcy is the fastest way to get rid of debt you can’t pay. Why? Because, bankruptcy allows you to get rid of and not pay back, certain types of debt. And, by “not pay back,” we mean that these debts are gone for good. You never have to pay them back, ever. It’s true. Find out for yourself.
Call today for a FREE Debt Consultation.
Find out what filing bankruptcy can do for you.
You have nothing to lose because the consultation is FREE.
Just call toll free (800) 209-4529.
Don’t lose another minute on the road to re-building your credit.
First-Aid For Your Credit
One of the best things about getting a fresh start by filing bankruptcy is that it allows you a chance to rebuild your credit score. Why? Because the first step in re-building your credit is to get rid of some debt and that’s what bankruptcy does best. With less debt, it’s easier to keep up-to-date on your remaining obligations and less likely you’ll fall behind again. However, your credit score won’t improve as long as all your old, negative information is still listed with and being reported to the credit reporting agencies. All three major credit-reporting agencies collected information about you before your bankruptcy, including balances due, late payments, charge-offs and judgments. After your discharge, all these debts should be listed on your credit report as “Included in BK.” After your discharge, all the accounts discharged in your bankruptcy case should be shown as now having a $0.00 balance. If they are not listed that way, they will appear to still be active accounts in collection status, which could limit your ability to get credit. Unfortunately, not all creditors update information after a bankruptcy discharge.
What Can You Do?
Plenty. A couple of months after your bankruptcy discharge you should order credit reports to make sure all your discharged debts are listed as being included in your bankruptcy case and now show only $0.00 balances.
You can contact the three major credit reporting agencies at the following numbers:
Trans Union, tel. no. 1-800- 888-4213 or
Equifax, tel. no. 1-888-397-3742
Experian, tel. no. 1-800- 997-2493
Even easier, order your credit report online:
As you will see when you go to any of these websites, you can also order online a 3-in-1 credit report, which includes information from all 3 of these agencies, and which also apparently includes information about your credit score, etc. The cost is about $29.95 (as of 12/19/04).
Here are some other valuable tips to help you rebuild and improve your credit rating after your bankruptcy discharge:
Give Yourself Credit:The best way to rebuild your credit after a bankruptcy is to establish accounts that will report positive information on you. Get a single credit card with a small credit limit, use it very sparingly and pay the entire balance every month before the due date.
Read the Small Print: After your discharge, you may get several offers for credit cards and other loans. Know what you’re getting into before you accept these offers. Make sure you understand the interest rate, any other fees and the expected payments before you open a new credit account.
Prove It: Even after your debts are discharged, you may need proof that you don’t owe these creditors any more. Keep a copy of all the papers filed in your bankruptcy case. Your attorney should have provided you with a copy. Keep these papers with your other important papers and documents, and don’t give away your only copy. You can use these documents to prove: (1) That you filed bankruptcy, (2) Which debts were included in your filing, and (3) That you got your bankruptcy discharge.
Pay on Time: Most credit cards and utilities report late payments to credit reporting agencies. After you file bankruptcy, if you make late payments every month, potential lenders will continue to see you as a poor credit risk. Also, most credit cards add a late fee whenever you’re late with a payment. Avoid late fees and reports of late payments by paying your accounts in full before the due date.
Ten (10) Tips For Rebuilding Credit
There is Life After Bankruptcy!
Your ability to re-establish credit after filing bankruptcy is better than ever.
After you get your bankruptcy discharge, you will receive many solicitations from lenders offering to finance homes, vehicles and credit cards.
And why not?
Bankruptcy gets rid of debt and getting rid of debt is the first step for re-building credit. Getting rid of some debt puts you in a better position to handle more credit.
In fact many, many former clients have told us they started getting credit card offers right away – within weeks after their bankruptcy case was done.
Here are some tips on how to rebuild your credit.
Open a checking or savings account. And, start saving some money. You will need money for down payments. The more money you can pay down on a purchase, the lower the interest rate you will get. Besides lenders may look how you handle a checking and savings account as one indication of whether or not you can responsibly handle money.
Apply for store and gas credit cards that you would normally pay cash.
Apply for a secured card where you deposit cash and charge against it. Make sure you only apply for secured cards with a company that promises to report regularly to the major credit reporting agencies. The major credit reporting agencies are Equifax (www.equifax.com) , Experian (www.experian.com) and TransUnion (www.transunion.com). They maintain your credit record. Think about it. What good does it do to get a secured card from a company that does not report to the major credit bureaus? Pay back advances in a timely fashion to build a track record of paying on time so that they will be reflected as positive marks on your credit report.
Pay your utility bills and rent on time. After filing bankruptcy…building up a history of paying on time is crucial.
Find a friend or relative to cosign for you on a loan and pay it on time. But be careful here. If you don’t pay it or don’t pay it on time you will do significant damage to the credit record of the friend or relative who was kind enough to cosign for you.
Look for car dealers and mortgage brokers that claim to be “bankruptcy friendly”. Buy a slightly used car so you do not get hit with the depreciation that occurs during the first two years of a new car purchase.
Stay away from payday loans and finance companies that are at high interest rates and are a “bad credit” trap. These outfits will suck you dry and leave you back in debt.
Write a letter to each credit reporting agency explaining the circumstances that lead to you filing. You are allowed to submit up to 100 words of explanation to each credit reporting agency.
Live within your means. If you don’t have the money don’t spend it. If it helps, limit yourself to what you need, rather than like. Remember what got you into debt? Remember when you bought everything you wanted whether you needed it or not? And, as a rough guideline, try to make sure your payments on consumer debts don’t exceed 20% of your expendable income-after your costs for housing and a vehicle.
Pay your remaining debts, left over from your bankruptcy, on time.This is worth repeating. This includes things like non-dischargeable taxes, student loans, car loans, truck loans, and house mortgages. This is crucial if you want to reestablish your credit.
Make sure the information on your credit report is accurate. The best way to do this is to get an updated copy of your credit report. After filing bankruptcy, it’s probably a good idea to get an updated credit report every 6 months for a year or so. How do I get a copy of my credit report? The easiest way is to get it directly from one of the 3 major credit-reporting agencies. Each of them offers a “3-in-1” credit report, which simply means a credit report containing all the information from all agencies. The cost for the “3-in-1” credit report is $29.95 (As of 12/19/04). The best way to order your credit report is “online”. You can go to any of these websites: Equifax (www.equifax.com) , Experian (www.experian.com) and TransUnion (www.transunion.com). There is also other valuable information on these websites, including: (1) information to help you understand your credit score, (2) further information on how to rebuild your credit, and (3) information on how to fix any errors that may appear on your credit report.
After of 1/1/05, California residents have a right to get one(1) FREE Credit Report per year. Go to www.annualcreditreport.com. At this website, you can order a copy of all reports compiled by the three major credit-reporting agencies: Equifax, Experian and Trans-Union. You can also get your FREE credit report by calling toll free to: 1-877-322-8228.
You will need to provide your name, address (and previous address if you have moved recently), Social Security Number and date of birth. You will be asked to answer some authentication questions to make sure that it is you and not somebody else trying to get your information, such as when was your last mortgage or car payment. People have reported that completing the forms can be a bit confusing.
Want even more information? One of the best resources, about life and credit after bankruptcy is the book entitled Bounce Back From Bankruptcy, written by Paula Langguth Ryan. Buy a copy and read it. One way to find out where you can buy a copy of this book is to search online, typing into the search engine “Search” box, the name of the book. Here is a list of the topics covered in the book:
- How to build new credit
- How to avoid getting in debt trouble again
- How to get a car
- How to line up an apartment or house to rent
- Why my employer can’t fire me for filing bankruptcy
- How to get rid of my remaining debts
- How to get a new credit card
- How to travel without credit
- How to buy a home after bankruptcy
Credit: What’s the real story?
Most viewers of this page will not have the best credit, if they have any credit all! That’s why you’re here and we have some great news for you. You might be thinking that you don’t need credit. Have you every called the phone company to order service? Every wonder what they are doing when they take your order and then put you on hold? You would be surprised! One of the largest credit reporting companies in the USA sold all of it’s credit history on most people to utility companies.
Now! Haven’t you ever wondered why the utility company wants to know your Mother’s maiden name? Are you thinking that they are just real friendly? They are verifying that you are who you say you are, and they are making sure that you have paid all of your past utility bills with all similar companies.
Is that important information? No! Not really! It is meant to inform you that your credit history will be with you forever, even if you don’t have a credit card. It’s important to know how people are using this information, as this information can affect your life in many ways.
When you file Bankruptcy using Federal Laws, does that hurt your credit?
Well, chances are your credit was hurt pretty bad to begin with. And, if you do nothing, your credit history will continue to get worse, not better. When you use Federal Laws, it stops the aging process. By that we mean that those bills that are 5 months old, or 3 months old, or more, will never age after the petition has been filed with the courts. How does this affect you? Stopping the aging process means that your credit report will not show a longer history of delinquency. So in that sense, you can put a stop to the aging of bills. That’s good!
Of course it’s better to repay everyone as originally agreed, but not everyone can do that and we are here to help those that just can’t. Let’s say that you are thinking about getting rid of all your bills using Bankruptcy. Does that mean that you will never have credit again? No! Not at all! Once we have filed your paperwork using Chapter 7 Bankruptcy as an example and have completed the process, which is approx. 90 days, you can get new credit quickly, if you want it.
Let’s say that you need a car for getting back and forth to work. Your newspaper is full of car dealers who want your business. Why, you might ask, would a car dealer want your business after you file a Bankruptcy that gets rid of your bills and financial obligations? First, the car dealer knows that you now, have NO Bills, except living expenses! You’re out of debt or nearly so. And you most likely will not be in this situation again for some time. Second, he’s in business to make money, as we all know. Sure, he’s going to charge you a little extra to get you financing and a little more on your down payment. Wouldn’t you if you were him? It’s a small price to pay to get what you want and to start establishing new credit immediately. Third, if you don’t pay him, he knows he can just repo the car and sell it again and make even more money.
Why wouldn’t this guy be anxious to put you right into a nice car? Just open your newspaper and look at the car dealer ads. What you will see is ads that say things like: “Bankruptcy – No Problem.” When you use Federal Laws to consolidate your bills under Chapter 13, it’s a different story. The car dealer knows that until your Chapter 13 case is complete, you are on a budget and that most of your spare money is going to repay at least some small part of your old bills. He also knows that if you don’t make your monthly Chapter 13 payments, your case will get dismissed, and then every bill collector that you owe money to can jump on you all over again and that makes you a real risk in his book. Still there are car dealers here and there that will sell you a car-even in Chapter 13. But sometimes, you may need a co-signer.
People in Chapter 13 bankruptcy cases can start credit again but generally they must wait until they complete their Chapter 13 cases. This is the time when as with Chapter 7, their remaining debts will be discharged. It is also a requirement in Chapter 13 that any changes in your budget, be approved by the Court. The idea is your Chapter 13 Trustee and the Court want to make sure you don’t take on any big, extra debts that might make it impossible for you to successfully complete your Chapter 13 plan. Think about it. This is really for your protection.
We discuss all of this and more with you when you come in for your first FREE Confidential visit.
Some people are worried about a security clearance, or military standing, or their job. And they should have some concerns! If they are behind in their payments, they should move quickly, and get a jump on the collection process. You can go a long way toward protecting your family, your job, your reputation, and your future credit but only if you get good, sound legal advice before things gets worse. There are numerous ways to deal with debts and we can’t go over the various options here, but rest assured that answers to your debt questions are only a Free Debt Consultation away. The quicker you get answers, the quicker you can start re-building your credit. And remember this: The first step in re-building your credit is to get rid of some debt.