A rant and your 2014 goals?

[PhillyGuy]

If you don't mind me asking, what caused you to file for bankruptcy, if you were never behind or late on any bills? Not trying to be rude, I just always wonder that, when I hear about people with good credit filing for bankruptcy.

Real Estate, secondary job. Had a partner that fell on bad times which then affected me as well. I couldn't keep the real estate on my own. I wanted to keep some of it, but my attorney advised against it. I had to include my credit cards even though I made all the payments up to filing.

Since I was current on all my personal accounts, even though the BK process, and make a good dime, I am assuming that is why my credit didn't get killed in the BK7.

[Drazil65]

If you don't mind me asking, what caused you to file for bankruptcy, if you were never behind or late on any bills? Not trying to be rude, I just always wonder that, when I hear about people with good credit filing for bankruptcy.


Although this was not asked of me directly I feel that many here can respond to this question. For us it was a major job loss of the breadwinner in our house, within a couple of months of that job loss our out of state tenant (renting our house 5 yrs in another state) took a job transfer and we had 30 day notice to get new tenant (took us 8 months before we found someone qualified) so we paid 2 mortgages during that time, spouse had to take job after 6 months of being unemployed in another state and commute on weekends (gas was tripled for us and because he was not in town we had to get a beater 2nd car which cost us extra money from savgs), snowball effect.

We did a lot of preparation to get to filing and filed about a year after we drained everything, we stopped making payments on the rental house (surrendered in the chapter 7 still not foreclosed on 2 yrs later) so we could continue to make the payments on the primary but put the primary up for sale that year (still trying to do the right thing). It did not sell so we took it off and put it back up the following spring, sold later that year (one yr after discharge) as a short sale but stopped making payments so we could save to move. We always tried to do the right thing but what we know now is that it was the right thing for everyone else (banks etc).

We did not file because of CC debt, we did make our payments until we decided to file (6 months prior to filing) and our CC debt was the least of all the amounts. Paying 2 mortgages at the same time drained our resources twice as fast (as well all living expenses and all other debt), we were stupid using all that money and we know that now. We are starting from scratch again and in March will be 2 yrs since discharge. We have made major lifestyle changes in our lives, we will rent because you never know when the real estate will bomb out again (the added stress during the rough times of trying to do everything to save the homes was physically exhausting and our biggest worry) as well as all that time and money down the drain, we will only pay cash for "things" so if we do hit on hard times again (ie one of us loses their job again) we can just pay for living expenses on one paycheck. We are rebuilding our savings so much faster (we are living on spouses pay only and banking mine to savings) as well as the retirement funds (and our sons college fund).

It just got really simple for us, lesson learned real fast. One of the biggest things we learned is that you cannot depend on all those people that want to give you credit and loans when things are good, no matter what your credit score is when you lose that wonderful job you will become just another name on the collectors list in the end. Our stress level is low and the quality of our family life is a direct result of the changes we have made. It works well for us....

[ccmisery]

Those that get credit cards 2 weeks after discharge probably filed before they had any late payments or debt that went into collections.

I had excellent credit and credit history going back to the early 1990's, a car lease that was 3 years old and never late along with a auto loan that was not late, and I was unable to get anything so soon and have not tried since PNC rejected me on a $250 secured credit card.

To be honest, only use for me for Credit Cards would be business travel, to go shopping with it and buy things I cannot pay cash for immediately is the building blocks of being in debt again.

I heard on the news tonight that credit card debt is at an all time high, glad I do not have that in the back of my mind anymore! Banks do not offer the high interest rates on your investments, savings or CDs, maximum profit at the mercy of consumers living on plastic, not to be a Suze Orman but most cannot afford it.

[rustymich]

How are you going to raise the score 50 points by years end?Thanks

[iswmle]

We also put all of our utilities on a card and pay it off when the bill comes due.. Other than points, this process just really streamlines things: instead of paying several different companies I just make one payment and Poof! done. All of our charges are run through a credit card, and then paid in full at the end of the month. I have not paid interest since my BK. But I am not a points chaser, either. I hate applying for cards, I hate looking at different Rewards, etc. we just pick and go. Barclays has been good to me, so much so I got my husband to get the Arrival. We may get something better in the future, but we are content with what we have now.

We are taking an international trip this November. We have $700 worth of airlines miles saved up from our normal, everyday spending. It is a win to use a credit card for Rewards as long as you PIF every month.

[PhillyGuy]

How are you going to raise the score 50 points by years end?Thanks

It is a goal (fingers crossed). I will update this thread if one is reached and hope others do the same.


To reach the goal, I will keep up with my payments as I have done anyway, having my asset case closed, and the biggie, my car was reaffirmed but the lending company will not update my account to current until the case is officially closed, so it is still listed as IIB. So once my case is closed, and my car loan is updated as current and up to date since the beginning of the loan, that should be a nice bump in credit score. I also have zero inquires over the last 2+ years. That will change when I finally decide to apply for the CapOne card which will happen when the case is closed and car loan is updated on all CRs.


Also, another goal for this year to add to the list above is to hopefully payoff my car loan, making Dec 14 my last payment.

[CCsAreEvil]

Yep, that is me. I get 2% back on my AMEX, 1% on my Mastercard with 5% on certain purchases, 3% on gas with my costco amex, 5% off the purchase at target and lowes with their respective cards. I get $14 oil change and tire rotation with my tire choice cc and discounts on other auto maintenance.

How'd you get an Amex card post BK? I thought they don't give cards to those with a BK even if you did not BK on them?

[ccmisery]

How'd you get an Amex card post BK? I thought they don't give cards to those with a BK even if you did not BK on them?

Make that two, AMEX is not BK friendly at all and very strict with good credit. I had a 725 FICO a few years ago, and they declined me probably based on utilization.

[Logan]

How'd you get an Amex card post BK? I thought they don't give cards to those with a BK even if you did not BK on them?

I cheated, my wife has good credit. I do have a Chase card that gets back 1% with 5% back on certain items and a Capital One it 1% cashback. I don't need her for perks but because of her I get any card I want .

Logan

[angel2002]

We are awaiting discharge after filing in March 2011. Our goals now are much different what they were when we filed.

I was one of the posters that were "counseled" back on a previous post of mine regarding what to expect after discharge for rebuilding credit. I had asked what steps we could take in order to help improve our scores so that we could refinance a recently purchased car at 19% interest rate. We don't plan on keeping the car long term but we also don't want to pay the highly inflated interest rate either. I had asked if obtaining a secured credit card or even a secured loan would help boost those scores after discharge so we could refinance.

I guess because I mentioned the words "credit card" it appeared that we were rushing out the gates to drape ourselves in diamonds, Rolex's and furs with a huge windfall that fell into our lap in the form of a discharge. Surely we would be filing bankruptcy within no time because of our hastiness to improve our financial strength and future. Clearly we never learned our lesson from this whole process.

I forgot that taking a 10% paycheck reduction because of union concessions was our fault. I forgot that union concessions were not enough for my employer so my hours were reduced was our fault. I forgot that the company decided to down size after 1 year of concessions and I was laid off, was again, our fault. I forgot that my husbands 3 foot surgeries caused him to miss a lot of work was our fault. I forgot that because my house was burglarized it was our fault. I forgot that we had to file a homeowners claim because of the burglary for nearly $20k which resulted in my insurance premiums to increase over 250% adding $200/month to our mortgage payment was our fault. I forgot that I had to accept a lower paying job because it was more than unemployment was our fault. I forgot that our previous health insurance premiums through my old job at $40/week increased to over $200/week through my husbands employer was all our fault.

Yes I can totally see how our foolish credit card spending habits contributed to everything. The truth in the matter is that what small amount of credit card debt we did have before filing was nothing compared to the fire storm we were facing with everything else.

We plan on getting 2 credit cards again like we did before filing and no more. We also plan on getting new cars. Our major goal 3-4 years out is to get a bigger house. Considering our financial health has improved dramatically over the last three years we can go back to a normal life again. We weren't extravagant in our ways back then nor will we be after discharge. I don't see the point in obsessing over credit scores unless there is a tangible, achievable and realistic goal that you set for yourself. If we could save the entire purchase price for the house in 4 years and pay in cash we would but realistically we can't do that. We can however save a good 10-20% to put down. We can also save 30-40% to put down on the new cars we intend to purchase at the end of the year. This will allow us to pay them off within a year or two all while it helps to improve our credit.

If living on cash works for some people than that is great! For others that occasionally need to borrow then it's best to work on that credit so you don't have to pay more than necessary. Best of luck to anyone with goals this year.

[Blossoms]

Very well said, angel2002! My husband and I are in a bankruptcy right now, and credit card debt is also a tiny bit of our bankruptcy debt, actually only about $3500, including hundreds of dollars in interest and late fees.

And about 80 percent of the credit card debt is from paying for the balance of my daughter's tuition during her last year of elementary school, in 2012. She was attending a Catholic school for special needs kids. I lost my job, and while the school gave us financial aid, it wasn't enough to cover the full tuition. She would not have been able to graduate, if I hadn't paid her tuition. We weren't living high on the hog on credit cards, that's for sure.

[angel2002]

Thanks Blossoms! It's nice to know there are others out there that don't look at credit cards as the gateway drug to financial ruin. I don't particularly care for them but they are a necessary evil in my eyes when cash just isn't an option or isn't available all the time. Congrats on your daughters graduation from Elementary School! My son graduated last year as well and is now in 6th grade this year. My youngest entered Kindergarten this year and is loving every second of it, so are we considering we don't have to pay day care anymore!

Best of luck on your BK and Happy New Year!

[Blossoms]

Thanks, angel! I agree about credit cards being a necessary evil!

My daughter is a sophomore in high school now, turning 16 this month. Ready to start learning how to drive, and get a job and her first bank account, and looking forward to prom next year. My son is a 5th grader, turning 11 next week, and starting middle school this fall. Once they start school, time just seems to speed up! We moved to a city with excellent public schools last year, so this is the first time in 11 years, that we haven't had to pay for school tuition. It's wonderful.

Happy New Year to you, too!

[PhillyGuy]

Update on 2014 Goals:
1. Have my bk7 asset case finally closed before my years anniversary of my discharge (March).
2. Apply for one (1) unsecured cc and get approved for over $1000.
3. Have all three FICO scores over 700 (One there, 2 to go) by December 31, 2014.
4. Have $12,000 in my emergency account.
5. Hopefully payoff my car loan, making December of 2014 my last payment.

The US Trustee has reviewed my TFR and has forwarded it to court. The court date is set for the BK judge to review the trustees fees and distribution of assets. If that is approved, checks go out, once all the checks clear, case closed.

My car loan (reaffirmed) has finally been converted back to a non-bk account, which will now show all the payments i didn't stop making through the bk process. With never missing a payment and never late, I hope this will give my credit a little help.

[tthoma49]

I love this thread. My goal for 2014 is to live on a cash only system and build my emergency fund savings. I did discharge close to $30k in credit cards in 2013. The thought of taking out more credit makes me nauseous. I see a lot of forum members file then go away from the boards for a while and come back in a bigger mess than before they filed the first time. I'm hoping and praying that doesn't ever become me.