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  1. #1
    sinker Guest

    Question Chapter 7 consequences

    I'm considering filing chapter 7 to escape a 14,000 credit card debt. I have no assets except a car that's worth only about 2,000. I will probably need a new car in another year or so and am wondering, if I file for chapter 7 today and afterwards avoided any further credit blunders, how long would it be before i could be approved for a new auto loan on only my own signature? What if my parents, who have excellent credit, were willing to co-sign? And if they did, would it affect their credit if I had no credit problems after the bk?
  2. #2
    bigun is offline Senior Member
    Join Date
    May 2001
    Posts
    7,135
    Unless there are some extenuating circustances, $14k is just not enough debt to file chapter 7 over. The average min. payment is 2 1/4% per month. I would suggest living below your means and working a parttime job if necessary to dig out from under that cc debt.
    Chapter 7 has a lot of ramifications and worrying about buying a car ought to be on the bottom of the list.
    To answer your question, it would depend on how hungry car dealers are and how large of a downpayment you bring to the table. I do know a person who was discharged in 8/99 and got Ford Motor financing in 12/2000 for .9%. However, he has a pretty good job and had a trade in plus about another 15% down. Your parents can cosign and as long as your payments are current, you shouldn't harm there credit.
  3. #3
    sinker Guest
    i also have a student loan of about 20K
  4. #4
    sinker Guest
    i earn 40k/yr. and have no other debts but those already mentionded, but the cc companies keep hitting me w/late charges and such and have increased my interest rate to 25% annually, at which rate i'll be in debt forever...
  5. #5
    sinker Guest
    bigun,
    if you're still there, i'd much appreciate some additional info. for example, is -14k cc debt (plus med bills of about 2k and 20k student loan) not enough to file for chapter 7, and what other consequences am i looking at if i do? thanks
  6. #6
    sinker Guest
    bigun,
    if you're still there, i'd much appreciate some additional info. for example, is -14k cc debt (plus med bills of about 2k and 20k student loan) not enough to file for chapter 7, and what other consequences am i looking at if i do? thanks
  7. #7
    bigun is offline Senior Member
    Join Date
    May 2001
    Posts
    7,135
    If you make $40k, you ought to be able to at least pay the minimums. Again, unless there are some extreme circumstances, you won't be allowed to bk the student loans.
    A bk stays on your credit report for 10 years. Your only chance at conventional financing for a mortgage will be FHA which are a pain to close as well as expensive to close. Afetr 10 years, the bk will be suppressed unless you apply for a job paying $150k'year, apply for a mortgage of $150k or life insurance for that amount, then it will be provided to those that check. In addition, many auto insurers are running credit checks to set policy rates. And, for awhile any unsecured credit you receive will come with very high interest rates.
    I think a lot of your problems could well be budgeting and living above your means. Contact the cc companies and ask about hardship plans where they'll reduce interest rates or minium for a time to let you get caught up. You sound kinda of young and I just think you really ought to fight as hard as you can to avoid bk.
    and get your credit cleaned up.
    Look at your life style. Get rid of cable TV, get rid of the cell phone and any gadgets you have on your phone. Try to find a cheaper place to live. Be a hermit for awhile. Look at a PT job. It's not forever, just until you get the debt situation under control. And, most important of all-stop charging things. Put yourself on a cash diet. Save the bk for a multiple of 14k.
  8. #8
    qtpie Guest
    How about calling one of those places that advertises on TV all the time. "It's not a loan-it's a way out of debt!"

    From what I understand, you call them, give them your creditors names, addresses, and account numbers along with your balances and they set up a payment plan for you. They can get your interest rates reduced (sometimes cut in half). It only works for credit cards. You cannot use a plan like this for medical bills or student loans, but if you could cut your interest rate, you could use THAT money for your medical bills/student loan.

    Here's the kicker: NO MORE CREDIT! You have to CLOSE all your accounts. (Which if you did NOT, it would defeat the purpose, right?)

    I'm sure you can find the name of one if you surf the web long enough.

    Oh! And it will show up on your credit report as being with a credit management program, but it's better than being Bankrupt.
  9. #9
    Chapter7 Guest
    the name of the group is: consumers credit counselors service. i have worked with them and they have assisted me greatly. you are better off working with this agency then claiming bk. it is quick and easy though you must keep acountable of each monthly statement to make sure you have not bee charged late fees. also get a hold of all of your cc companies after your credit counselor system is set up and make sure your due dates are all the same. i suggest picking a date at the end of the month since they will all be paid at the same time. i wish you the best!

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