On the horns of a dilemma...

[LoserBoy]

i have always found that the best source of information on any given subject is to talk to people who have been there before. That's why i'm here. I am thankful for such a resource because frankly the only other information Icould dig up was either from bankruptcy lawyers (yes, go bankrupt--its easy and painless) OR from credit counselors (no, don't go bankrupt under any circumstances--it will ruin your life), neither of which are what you would call objective.

Here's my story in a nutshell:

I was downsized out of a director level marketing position about 4.5 years ago at which time I decided to become proactive and make my entrepreneurial dreams a reality. So, i started my own company (in an unrelated industry). We became very profitable, very quickly and had unprecidented success for a few years. Unfortunately, we were self insured and became part of a lawsuit that eventually signaled our demise. So as of about June I have been earnestly trying to get back into the corporate world. I have come very close on several occasions, but still no offer. When I do recieve an offer, the money will be fairly substantial (six figures), but in the mean time i make $0 and am becoming increasingly leveraged and buried in debt.

The numbers:

card 1: $25000
card 2: $12000
Loan: $20000 --personal loan still related to my now defunct business


I had quite a bit of money saved which is now gone, I am now down to one car, I have sold assets off right and left (including by beloved Rolex) to pay bills, but I don't see any light at the end of the tunnel. I feel like the biggest loser on the planet and like I'll never recover from this experience--certainly mentally if not financially.

The Questions:

1. When I do find a position, it will almost absolutely be out of state. Will I be able to buy a house in the new location? A second car?

2. Will perspective employers check my credit? If so, will a BK have an impact? (i'm not in the financial industry)

3. Should I just bite the bullet and deal with these debts when I do get back in the game (if ever), or would it be in my best interest to get rid of them now?

4. What about future unsecured credit? I need a card for internet transactions, airline tickets, hotels and car rentals--will that still be possible?

5. Anything else you think I might need/want to know.




I appreciate your input--many thanks in advance

[SinkingFast]

Filing BK could hinder future job prospects. Particularly if a Security Clearance is needed, of if you are involved with financial affairs. Many prospective employers have you sign a statement authorizing them to do a background check which can include a Credit pull as well.

One recent poster was into the 2nd or 3rd round of interviews when he/she divulged their BK. No call back. Other people here have told or not told as they saw fit and gotten new, better paying jobs. If Hubby's current employer did a Credit pull on him, it's not showing on any of Hubby's Credit reports. I think each situation varies and it's really gonna depend on the employer.

If you're current on your payments right now, you'll have a couple of months to work with before lates start showing on your Credit Reports. We made our last payments last December. Pulled our Credit reports the beginning of March and the CRA's were still showing us as current. After that, if a prospective employer pulls your Credit Reports, they may start seeing that you are 60-90 days late on payments.

Personally, if you decide to go BK and can delay moving, I'd file before you move. You're gonna have to use your current State's Exemptions for up to 2 years after you move to a new State. That can make finding an attny in your new location more difficult and more expensive. We moved and then realized we had to go BK. That was our experience.

If you are proactive about your BK and rebuilding, you can have Credit again relatively quickly after filing. Work on your Credit Reports to clean up errors, get all your accts reporting correctly. You'd be amazed, but simply disputing, some Creditors withdraw the acct as if it never existed. And getting the debt load dropped to Zero is a big help in boosting your scores as well.

[LoserBoy]

thanks for the reply--good info.



everyone else--jump in there, don't be shy. i won't bite (much)

[lrprn]

SinkingFast gave you good advice, LB. Bankruptcy isn't the end of the world. It does slow your world down for a spell, but full recovery certainly is possible.

To help see what your best options are, make 3-4 appointments with bankruptcy-specialty lawyers in your area. Most give a free half-hour to hour consultation. Take in a complete list of your debts, assets, and an average of your living expenses over the last year. Ask LOTS of questions, including the ones you asked us here. You'll learn a lot and can make a good decision with knowledge of the bankruptcy laws and customs in your area. SF makes a good point - if you know you have a high likelihood of having to move, filing before you move is much simpler.

Have you made money transfers, given more than $600 to family or friends, or made any large, non-necessity purchases on your credit cards in the last few months? You will need to stop using your credit cards for 90 days before filing to put the burden of proving any potential fraud on the trustee and not on yourself.

It's a long fall when you've been riding high financially, but the fall is surviveable and you will learn a lot about yourself and your inner strengths along the way. Material objects are just things. It's the people in your life and how you live your life that really matter!

[Grace]

If you file bankruptcy now and still have no job and no income, how will you support yourself after you file since you won't be able to use credit cards?

[Spartan]

.......It's a long fall when you've been riding high financially, but the fall is surviveable and you will learn a lot about yourself and your inner strengths along the way. Material objects are just things. It's the people in your life and how you live your life that really matter!...

Wow! Ain't that the truth!

One thing I can add is, Don't Look Back. Do not waste time in beating yourself up over what might have been. You should think about what you will do differently the second time around. But never dwell on the past such that it eats into your soul and drills holes in your hearts. You can't go on to find new happiness in life, if you do not let go of the past.

Best of luck.

[lrprn]

If you file bankruptcy now and still have no job and no income, how will you support yourself after you file since you won't be able to use credit cards?

LB wouldn't be the first person to humble himself and get whatever job is available to survive for the short term if he has to, Grace. He also might have other money sources (parents, significant other, friends, etc) he's not mentioning who might help weather his financial gap as well.

Interesting that you think LB could be planning to sit on the couch watching his navel lint collect doing nothing until the creditors chew him up and split him out The very fact he's here asking questions shows a willingness to proactively act and consider all his options.

[LoserBoy]

yeah, this whole thing is like a nightmare i'm having trouble waking up from. the ideal scenario would be to secure something in my field quickly--before the debt gets any higher--and nip this thing in the bud asap. i know that BK isn't the end of the world and that it doesn't bear the huge stigma it once did, but i still would prefer NOT doing it if i have the choice.

on the one hand, being relieved of the debt burden would be a tremendous weight off of my chest, but on the other hand, i hate to pay for a few months of serenity for the next ten years. its like eating chocolate truffles---a minute on the lips, forever on the hips!


i know that the ability to reestablish credit is highly possible in a post-bankruptcy world, but at what cost? those of you who have been there, what kinds of rates are you seeing?

what kind of impact will this have on my FICO score? an asset i have worked very hard to protect for many years btw ((currently about 740)

[CindyLou]

BK was the best thing I ever did! Certainly not fun at the time, and the last year has had its challenges, BUT it did provide me with a good start. Now is the time to act for you!!!! Once you get that 6 figure job you can FORGET Bk7. Go for it. Get that fresh start. But you will have to forget about your credit score because it will fall drasitically. Since my BK I have gotten a new job with a very substantial income and have not had any problems obtaining credit, including a new Ford 3 months out of BK at .9% financiny . sorry to sound like an advertisement for a BK attorney, but it certainly improved my life and got me out of a hole i never could have dug myself out of!!! Keep us posted and wecome to the site.

[SinkingFast]

what kind of impact will this have on my FICO score? an asset i have worked very hard to protect for many years btw ((currently about 740)

In your past post, you mentioned selling off to stuff to keep the wolf at bay. Even your beloved Rolex. That's sacrifice.

Now you're gonna be hung up on a number??

There's more to Credit Score than the numbers from Creditor's viewpoint. There's groups or clusters of people too.

There's a group of people with little to no Credit. There's a group of people who've had lots of Credit. There are people who've filed BK. Who knows the total inside workings of the Credit industry. How many groups of people there are.

So right now you're a person who's managed lots of Credit with a score of 740. Compared to others in that group, you may be in the middle of the pack, we'll say. You file BK, you move into a new group. Clean up your Credit Reports, get your scores back up in the 700 range, and you may be at the top of the pack. BUT, when your BK drops off, you move over into a new group. Now you're mixed back in with people who have not filed BK.

And then there's the hidden score. The one Consumers do not see but Creditors do. Your rating of likelihood to file BK based on your debt to income and assets ratio.

It's kinda like trying to remain Valedictorian of the Class when the Grading Criteria is constantly changing. The score really is meaningless. You have a 740 FICO which sounds great. But you could be considered High Risk on the Secret Score due to your employment situation and debt load.