Should I file? Accounts dropped off credit reports.

[blueberry5]

I originally had around $100,000 in credit card debt, but it's been over 5 years since I've last paid them. I've held off on filing bankruptcy for a long time. I just saw a bankruptcy lawyer and was ready to start the process of filing chapter 7. The lawyer said I can't be sued by my creditors since the statute of limitations is 4 years (not sure if that's state-specific, but I'm in California).

I got my U.S. citizenship around 3 years ago, and in the process changed my legal name. I just tried pulling up my free annual credit reports online using my current legal name, but couldn't. It's probably because of the name change. I tried again using my former legal name and the same social security number, and got reports from Experian and Equifax, but not Transunion. I was surprised by the reports. All or almost all of my old credit card accounts dropped off. The current reports mostly show educational loans and a few other closed accounts. I'm assuming my current reports look so clean because a lot of old accounts have dropped off, but I'm a little worried my name change might be involved.

I checked old credit reports I had saved, and noticed that many accounts were set to continue on record until recent months. Does this mean that, in effect, it's as if I never had those accounts and no one (e.g., banks that I'm looking to get loans from, credit card companies, etc.) can see those old accounts? Do they still affect my credit score? Is it not even worth it to file bankruptcy anymore? Can I rebuild my credit history as easily without filing bankruptcy?

[LadyInTheRed]

Do not base your decision on your credit reports. Your credit reports are no indication of whether debtors can or will try to collect, including filing a lawsuit. If an original creditor or debt buyer tries to sue for a debt that is past the SOL, then you would have to file an answer asserting that as a defense. If you have a BK discharge, you would send the discharge order to the creditor and tell them that the lawsuit is in violation of the court's permanent injunction against collection efforts. If the creditor didn't drop the suit or tries to collect in any other way, you could sue them for damages. The bankruptcy discharge order is more powerful than the SOL. It really depend on whether you ware willing to risk an old debt resurfacing at any time. If I were you, I think I would wait to see if somebody sued me, then decide at that point whether to file BK or answer the lawsuit. But, I am not a worrier and would be very comfortable filing an answer to a lawsuit.

Once accounts are off your credit report, they will not effect your ability to get credit, except maybe with the creditors with whom you defaulted. I bet your credit reports will catch up with the name change eventually. In my opinion, your credit rating should never be a major factor in your decision whether to file BK.

[bcohen]

I agree with the above posting. Statute of limitations is an affirmative defense, which you must assert in your answer to any lawsuit which a creditor or junk debt buyer might file. It does not prevent the creditor/JDB from filing a lawsuit, and if you fail to file a timely answer to the lawsuit, the creditor/JDB will obtain a default judgment, and will proceed to garnish your wages and bank accounts.

If you qualify for Chapter 7 bankruptcy now, then it is probably in your best interest to file and to discharge the debts legally, which will prevent any creditors or JDB's from attempting to collect on those debts ever again.