Question for attorneys


S

Sunshine Lady

Hello folks,

I have a quick question.
It has been suggested by people who have absolutely NO legal training and are not credit counselors - just people talking.

What??

Does a Chapter 13 improve your chances of getting credit?? I have heard so many people tell others that they should consider C13
vs. C7 because the C13 looks better on the credit report when it is successfully completed.
Is this true??

Just wondering....................

Sun
 
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I

iNet Lending Group

Neither helps your credit (I am not an Attorney)

However, I think it is safe for me to say so many people put it iff when it
is just a matter of time, when you should just file & get it over with, so
you can begin to rebuild.




Sunshine Lady said:
Hello folks,

I have a quick question.
It has been suggested by people who have absolutely NO legal training and
are not credit counselors - just people talking.
What??

Does a Chapter 13 improve your chances of getting credit?? I have heard
so many people tell others that they should consider C13
 
J

John

A bankruptcy is a bankruptcy. One is not better than the other. In fact, I
would suggest a Ch. 7 _improves_ your chances of getting credit later
because
a) You walk out of it with no debt whatsoever
b) You can't file another one for six years.
If you're deciding which way to go, see if you can do a Ch. 7.

J.
 
S

Sofia

An attorney who used to practice Bankruptcy told me that as far as the
credit report goes ANY kind of bankruptcy looks just as bad as the
other.

She also said that often creditors prefer a 7 over a 13 because it's
more work for them to have to deal with the constant payments under
13, and what if you're late in paying-- should they file for relief
from stay, yada yada. Ch 13 can be a lot of work for a creditor.
With a Ch 7 liquidation, it's just over and done with and they can
close their books.

The attorney also told me that really the only motive to file 13 is if
you want to keep your house, etc.

Some people might want to file 13 because they want to be "good"
people and pay as much of their debts as possible, just like some
people in bankruptcy opt ot "reaffirm" some of their debts even though
they could be legally discharged. REMEMBER: a moral obligation is
NOT the same as a LEGAL obligation. (In other words, don't be a dumb-
dumb. If the law says the debt is legally discharged, then let it go.
If you feel guilty about it, then talk to a priest or rabbi etc. but
DON'T pay anything you don't legally have to).

Also, for a Ch 13 you have to prove you have a regular income to
qualify for that chapter.

Long-winded answer: all bankruptcies look bad on credit reports but I
think that a creditor would rather deal with someone who was just
completely dischared in a 7 than someone who is still having to make
payments under 13.

Sofia
None of the above is to be construed as legal advice. I am not an
attorney and the above is only my opinion.
 
T

Thomas Miller

Sunshine Lady said:
Does a Chapter 13 improve your chances of getting credit??
I have heard so many people tell others that they should consider C13
vs. C7 because the C13 looks better on the credit report when it is
successfully completed.
Is this true??
Hello,

In the years that I have been practicing law (since 1988)
I have heard this said many times, but never by anyone who
was able to offer specific examples of folks who benefitted
in the way you mention.

Please consider asking the folks who are telling you this
how they know it is true, and please post any concrete
information here.

Best wishes to you!

Kindest regards,

Tom
 
S

Sunshine Lady

Oh my,

I think perhaps I was not too clear. I have already done the C13 and am finished - just waiting for my discharge. I was just
wondering if the people who tell me that C13 is better than C7 (on the credit report) -- well just wondering if they were right. At
the present time I have absolutely NO intention of getting any credit. I have really learned to live in CASH. I know that at some
point I will probably want and/or need a line of credit.

Perhaps I should have been more clear in my post.
Thanks for the response. I am going to wait 6 months and get my credit report just to see what it says. The last report that was
requested (Jan 2003) was from my homeowners insurance and according to my agent it said I was "Voluntary Chapter 13". Whatever that
means??

Sun
 
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S

Sofia

Oops. Well, congrats on getting through this.

"Voluntary Chapter 13" simply means that your creditors did not force
you into a 7 liquidation bankruptcy by filing the case for you.
There is no such thing as an "involuntary" 13 anyway. Only a 7 or 11
can be "involuntary," meaning that the creditors force it on the
debtor.

Sofia,
Not a lawyer and the above is not legal advice.
 
R

Rick Friedline

Some people might want to file 13 because they want to be "good"
people and pay as much of their debts as possible, just like some
people in bankruptcy opt ot "reaffirm" some of their debts even though
they could be legally discharged. REMEMBER: a moral obligation is
NOT the same as a LEGAL obligation. (In other words, don't be a dumb-
dumb. If the law says the debt is legally discharged, then let it go.
If you feel guilty about it, then talk to a priest or rabbi etc. but
DON'T pay anything you don't legally have to).
My attorney's words:

"As far as the world is concerned, when you file a bankruptcy you are a son
of a bitch - but you don't have to be a STUPID son of a bitch!"

I got quite a chuckle out of it at a time when I needed one :)
 
A

Art

Why would your homeowners insurance pull your credit report?


Sunshine Lady said:
Oh my,

I think perhaps I was not too clear. I have already done the C13 and am
finished - just waiting for my discharge. I was just
wondering if the people who tell me that C13 is better than C7 (on the
credit report) -- well just wondering if they were right. At
the present time I have absolutely NO intention of getting any credit. I
have really learned to live in CASH. I know that at some
point I will probably want and/or need a line of credit.

Perhaps I should have been more clear in my post.
Thanks for the response. I am going to wait 6 months and get my credit
report just to see what it says. The last report that was
requested (Jan 2003) was from my homeowners insurance and according to my
agent it said I was "Voluntary Chapter 13". Whatever that
 
M

Michael

Call me a conspriacy theorist, but maybe "Chatper 13 is better" is
propaganda put out by those in the bankruptcy business to increase
business?

Anyway, I think 7 is better because it's over in 4 months and
therefore your credit rebuilding starts sooner. The 10 years on the
credit report starts sooner. THe eligibility for FHA loans starts
sooner.

If you are living hand to mouth, regularly borrowing from payday
lenders, pawnshops, storefront lenders and used car dealers, then what
you really need is a better job not more credit.
 
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I

iNet Lending Group

Then a clarification for you -

Both Chapter 7 and Chapter 13 completely destroy your credit equally.

--
Michael Papp
iNet Lending Group
www.iNet-Lender.com
MSN Messenger ID - iNet-Lending


Sunshine Lady said:
Oh my,

I think perhaps I was not too clear. I have already done the C13 and am
finished - just waiting for my discharge. I was just
wondering if the people who tell me that C13 is better than C7 (on the
credit report) -- well just wondering if they were right. At
the present time I have absolutely NO intention of getting any credit. I
have really learned to live in CASH. I know that at some
point I will probably want and/or need a line of credit.

Perhaps I should have been more clear in my post.
Thanks for the response. I am going to wait 6 months and get my credit
report just to see what it says. The last report that was
requested (Jan 2003) was from my homeowners insurance and according to my
agent it said I was "Voluntary Chapter 13". Whatever that
 
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