What is your best advice for new filers?

[anonymuse]

We have people on the boards that are in various stages of bankruptcy from "thinking about it" to "discharged."

What is the best advice--maybe something you really wish you had known before you filed--that you would give to someone considering or in the process of filing?

I'll share first: It's one thing to start collecting all of your receipts, but another thing to organize them to track your expenses. One thing that is saving me is Quicken (something like MS Money would work fine also). I created new categories that represent the categories on Schedule J. Then, since I have online banking, I was able to download the last 6 months of history into Quicken. Since I use my debit card instead of checks, categorizing some items was extremely easy (i.e. Conoco=gas). Other times, I'd have to go back to the receipts and possibly split the amounts into 2 categories (i.e. Walmart=groceries, cleaning supplies, & clothes.) From there, you can create monthly reports based on the categories to see exactly where the money is going.

[JusticeForAll]

I wish someone had told me to pull my credit report before I filed!

Unfortunately for me, I found two very old collections on my report (after discharge) from 5 years ago that I knew nothing about and were not included in my BK (because I didn't know).

Although my discharge says that all debts that existed the day of the filing are discharged, I've since been notified by my attorney that isn't exactly true and so along with my "fresh start" I'm now making payments on two old debts that one I forgot about and the other didn't even know existed.

So my best advice:
PULL YOUR CREDIT REPORT BEFORE YOU FILE SO YOU DON'T MISS ANYTHING!

[BassBoy]

EXCELLENT JUSTICE! My friend who is about to file pulled his credit and found a few old collections accounts that he was never aware of nor notified about.

[razorguns]

pulling your cr and adding everythihg from it, wont stop creditors from adding new old accounts to it later on. They can still do that. just fyi.

r

[no_it_all]

About a dozen or so manila folders. Label each with the name of a single creditor, your bank (checking and savings), payroll stubs and one for taxes. When the bills show up, place the statement in the appropriate folder. Ditto for bank statements and payroll stubs. Order copies of your IRS filings (or put the copies if you have them in the appropriate folder). As pointed out, get a copy of your credit report and put that in a folder also.

Of course this only works for those astute BK filers that actually have a game plan six or so months in advance.....not that I did that or anything..

[FilingOnMyOwn]

To be more cautious & proactive in the rebuilding process, not just blindly filling out applications as soon as my discharge rolled in. TrueCredit's 3 in 1 report with scores and alerts is the best deal out there ($11 a month), and I wish I would have been subscribed since before I filed bk. So where I screwed up big time was applying to things before knowing that everything was fixed on my reports. So I was getting declined for alot of things from 'bk friendly' lenders, not knowing why. Now I have about 50 inquiries on my credit reports, with only 8 accounts that were actually approved and soon half of those will be cancelled. So for about the next 2 years until all my inquiries fall off, I'll be stuck with the 4 accounts that are even halfway decent, and one of them is hooters

[keepmine]

In addition to the other suggestions, mine would be the mindset.
When bk was inevitable for me, I got all emotions out of the equation and just looked at it as a cold hard business decision. I was no different than the CEO of United Airlines. All I wanted was to completely destroy all of my creditors to the maximum extent the law allowed and keep everything I possibly could. I took no prisoners. I discharged about $71K worth of debt, signed NO reaffirmation agreements and emerged from bk with a near 6 figure net worth {kept the equity in my home and my ERISA qualified retirement accounts}.
My advise is learn to preplan your bk. Sign no reaffirmation agreements unless you have to do it to keep secured property-forget about your credit score. Plenty of time to rebuild if that's your goal. You just don't want a creditor millstone around your neck if it can be avoided.

[Interlaw]

I wish someone had told me to pull my credit report before I filed!

Unfortunately for me, I found two very old collections on my report (after discharge) from 5 years ago that I knew nothing about and were not included in my BK (because I didn't know).

Although my discharge says that all debts that existed the day of the filing are discharged, I've since been notified by my attorney that isn't exactly true and so along with my "fresh start" I'm now making payments on two old debts that one I forgot about and the other didn't even know existed.

So my best advice:
PULL YOUR CREDIT REPORT BEFORE YOU FILE SO YOU DON'T MISS ANYTHING!

Assuming the debts were general unsecured debts, and yours was a no-asset case, they were discharged, and you shouldn't be making any payments on them, listed or unlisted.

Why does your lawyer say you should pay them?

Brett Weiss
[email protected]

https://www.brettweiss.com/bankruptcy

Maryland, DC and Federal bars
Member, National Association of Consumer Bankruptcy Attorneys

--> Read our Bankruptcy FAQ at www.brettweiss.com/bankruptcy/FAQ/br_faq.htmwww.brettweiss.com/faq/br_faq.htm.

************************************************** ***************
The Small Print: This response is for discussion purposes only.
It isn't meant to be legal advice and you shouldn't treat it as
such. If you want legal advice, speak with a local lawyer
familiar with your state's laws who can review *all* of the
facts and the law applicable to your situation.
************************************************** ***************

[lrprn]

For those thinking of filing - I wish we had gone directly to see a bankruptcy lawyer rather than trying credit counseling first and also pulling out 401K retirement funds trying to stay afloat. Wasted 8 months and $6,400 trying to stave off the inevitable with the credit counseling service (ours was legit too - just couldn't overcome some of our cc companies increasing our APRs and others declining to participate in the management plan) plus now we have a trustee objection to our Ch 13 plan related to repaying the twice-be-cursed 401K loans.

If you are here exploring bankruptcy, then chances are you are on the edge if not already falling off the edge financially. Make a few free consultation appointments with a bk-specialty attorney in your area and listen to what he/she says. A good one will let you know if you have a snowball's chance in he** of making it without filing. And if you need to file, putting it off with stopgap measures like credit counseling or borrowing more money just delays the inevitable.

[JusticeForAll]

Here is another one:

I wish my lawyer told me not to apply for credit to re-build before my discharge, I specifically asked him and he said "no problem".

I got a $1,000 LOC to use to re-build and the Lender gave me a check, then 2 months later (while I was making payments on it and was curent) checked my credit and wrote the debt off as IBB which still shows on my credit report and promptly send it to a collection agency (the orginal $1000 is now $1400 due to interest, penalties and legal fees since I stopped paying it when they refused to report it correctly to the CRA).

Lawyer says I have to pay it as it's not dischargable (even though it existed the day I converted from 13 to a 7).

So my effort to re-build too soon actually hurt me. I have another baddie on my report, even though I'm paying it.

PS: Brett, to answer your question, my Lawyer told me that if it wasn't listed I would have to re-open my case to get these listed and he wants about $750 to do it. He said the Lender for the LOC could also re-open my case and I could be in trouble to applying for credit while I was in BK and that I should just pay it and not rock the boat. I discharged approximately $600,000 ($130,000 unsecured, the rest in secured real estate) in debt and he said it's a small price to pay to get rid of the rest of it. When I reminded my attorney that he said it was okay, his response to me was "you've made a simple BK into a more thought provoking legal issue than necessary and you should try to refrain from asking so many questions". I actually still have the email he wrote where he said that!

So, don't apply for credit BEFORE your discharge, it could get ugly!

[Interlaw]

For those thinking of filing - I wish we had gone directly to see a bankruptcy lawyer rather than trying credit counseling first and also pulling out 401K retirement funds trying to stay afloat. Wasted 8 months and $6,400 trying to stave off the inevitable with the credit counseling service (ours was legit too - just couldn't overcome some of our cc companies increasing our APRs and others declining to participate in the management plan) plus now we have a trustee objection to our Ch 13 plan related to repaying the twice-be-cursed 401K loans.

If you are here exploring bankruptcy, then chances are you are on the edge if not already falling off the edge financially. Make a few free consultation appointments with a bk-specialty attorney in your area and listen to what he/she says. A good one will let you know if you have a snowball's chance in he** of making it without filing. And if you need to file, putting it off with stopgap measures like credit counseling or borrowing more money just delays the inevitable.

The vast majority of my clients should have filed for bankruptcy 6-12 months (or longer) before they do. To hold off filing, they exhaust savings, LOCs, and retirement plans, as well as loans from friends and family...and end up in the same place, only with more debt and less money.

You are far from alone in doing this.

Brett Weiss
[email protected]

https://www.brettweiss.com/bankruptcy

Maryland, DC and Federal bars
Member, National Association of Consumer Bankruptcy Attorneys

--> Read our Bankruptcy FAQ at www.brettweiss.com/bankruptcy/FAQ/br_faq.htmwww.brettweiss.com/faq/br_faq.htm.

************************************************** ***************
The Small Print: This response is for discussion purposes only.
It isn't meant to be legal advice and you shouldn't treat it as
such. If you want legal advice, speak with a local lawyer
familiar with your state's laws who can review *all* of the
facts and the law applicable to your situation.
************************************************** ***************

[SinkingFast]

The vast majority of my clients should have filed for bankruptcy 6-12 months (or longer) before they do. To hold off filing, they exhaust savings, LOCs, and retirement plans, as well as loans from friends and family...and end up in the same place, only with more debt and less money.

You are far from alone in doing this.

Brett Weiss
[email protected]

https://www.brettweiss.com/bankruptcy

Maryland, DC and Federal bars
Member, National Association of Consumer Bankruptcy Attorneys

Years in our case.

We cashed out one 401K trying to stay afloat.

Few years later, refi'd the house. Super inflated appraisal. 80% conventional and 20% HELOC.

Then Hubby lost his job. Had to move with new employment. Cashed out the next retirement savings, 401K rolled over to IRA, to pay off the HELOC so we'd be in a position to sell the house.

Sold things.

More than a few attnys said, "Do you know how much money I could have saved you if you had come seen me sooner??"

About a dozen or so manila folders. Label each with the name of a single creditor, your bank (checking and savings), payroll stubs and one for taxes. When the bills show up, place the statement in the appropriate folder. Ditto for bank statements and payroll stubs. Order copies of your IRS filings (or put the copies if you have them in the appropriate folder). As pointed out, get a copy of your credit report and put that in a folder also.

Of course this only works for those astute BK filers that actually have a game plan six or so months in advance.....not that I did that or anything..

I strongly recommend this. I got one of those expandable file folder, carrying case things with a handle on the top. That's how I organized all the docs all the attnys kept telling us we needed to gather together.



My own personal suggestion,................

Take your time!

Unless you're under the gun pending a Law Suit or trying to stave off Foreclosure of your home that you really want to keep, wait.

Filing BK is like the teacher saying you can only have one bathroom pass the whole school year. You don't wanna use that the first day of school. Choose your time wisely. Make sure you get as many things included as possible.

You don't want to rush to file and 2 months later wind up with HUGE medical bills that you could have discharged by rushing to file simply because you were antsey.

Time is the BK Filer's friend. The more distance you put between you and those charges the better.

WAIT, WAIT, WAIT as long as you can to file.

[jane taylor]

Oh boy, do I ever know about this!!!!! You cannot put a Band-Aid on a gaping, flesh wound!! We cashed in ALL of our retirement, refinanced our house a couple of times, borrowed money, you name it trying to stay afloat. The truth is that we were NOT afloat! Over the past three years we have had three job losses and HUGE medical bills. I wish we had taken the advice of a dear friend who is an attorney and filed BK before the New Law took effect. We would be in so much better shape now, but we tried to do "the right thing." I wish we could have waited and filed as my husband had to have major surgery and then had complications (the surgery from you-know-where I call it!). We would have lost our home if we hadn't filed and it was important to us to keep it.

SinkingFast, I like your analogy of the bathroom passes You are so right.

[down @ out]

Wow this is a good question. I filed and was discharged under the old laws so a bit of this maybe dated.

First understand how serious all of this is. You cannot trust anyone. Educate yourself regarding the laws and what is expected of you. This is a job you have now. Deal with it as such. Do a bad job and it can ruin the rest of your life.

Expect incompentence and mischief.

Be honest but do not be stupid.

Visit 341 hearings so you can get a feel for all of this.

I filed pro-se because after visiting 341 hearings and reading up on the material and talking to attorneys I ended up with no respect for the legal profession.

I remember at my 341 hearing the attorneys getting beat up by the trustee for not completing paperwork, etc., and in general being no good. The trustee looked at me and thanked me for taking the time to do it right. I had sent her all my records a month before the hearing and I was in and out in 5 minutes.

Everyone in this process can screw your brains out. The only way to prevent this is to educate yourself and do what is right for you. Bankruptcy attorneys are generally worthless and can do a lot of damage.

Also keep in mind you are not doing anything to be ashamed of. Unlike our government we cannot print money legally.

[FoolAndHisMoney]

SF wrote exactly how I feel about the whole thing. If it's the first day of school then hold it in unless for some reason you just can't and don't want to make a bigger mess.