[jor]

Hi

I've had a personal tragedy in the past... about 3 years ago and was unable to keep track nor have the ability to pay any of my bills. I am considering to go bankrupt --- in lieu of, I was just told that perhaps if I wait 7 years since the last time i paid my bill (ie. credit cards, line of credit, phone bills, electricity bills) --- the creditors stop pursuing you and you'll be left with no credit instead of bad credit.

Can someone please shed some light on this?

Thank you

J

[Bruce_the_vii]

Bankruptcy is a blessing in disguise. A book I read called "Looking out for No. One", that was endorsed by Ann Landers urged people to look after yourself, don't worry about your creditors. the book was popular for a while.

You can cut a deal and pay 10 cents on the dollar and the banks will give you your credit card back. If you can live without a credit card, say have one from family you can simply go bankrupt. You need a credit card in your name to rent a car, which comes up from time to time. In seven years your credit rating is restored.

Also remember if you have paid high interest rates for a significant time the creditor has his money back.

I have friends and family that went bankrupt. It's factored into the system with high interest rates and it's perfectly legitimate to walk away from your debts if you are in pain.

It's part of the system.

[Wada]

Bank records (your credit rating) is based on your record over the last twenty years. After seven the loan may be forgiven but the record of it remains for twenty.

[jor]

Thank you Bruce for your answer however, because it's already been about 3 years since I've last paid my bill.... i was wondering if I should just wait another 4 years for my credit to clear? Is this possible??

[herbie]

Having no credit is worse than bad credit.
My gf came froma camp job that shut down and was persuaded to enter one of the credit repayment plans, 5 years later we were informed by 2 banks that filing bankruptcy would've been better.
I paid down and scissored all the cards and have saved up and bought everything cash (debit card not credit) since 1994. Now I can't get one as I have no credit rating. Even applied for one through the credit union where I have significant term deposits and MC rejected the application. Can't even get a gas card.
Stupid thing is, I'm the cardholder for my company and Visa increased that one to $10K.

My company where I do ALL the work is worthy. I am not. Fuck 'em.

[Bruce_the_vii]

jor jor:

Thank you Bruce for your answer however, because it's already been about 3 years since I've last paid my bill.... i was wondering if I should just wait another 4 years for my credit to clear? Is this possible??

I've never heard of this. I doubt it's that simple and straightforward as the creditors won't be happy. Bankruptcy sounds a lot cleaner to me. I would take the official route, some creditor could come out of the swamp and lay claim to you.

I have a friend that sued the bank for charging unconstitutional interest rates back in the 1980's. The courts actually heard the case. The bank simply waited and took the house. He went bankrupt but eventually he got another mortgage.

[Choban]

Bankrupcy is the clean cut way to go, your back in the black and able to start rebuilding your credit through prepaid credit cards ect..., Alot of folks go through it and come away better off than if they struggled for years to repay everything.

[BartSimpson]

I won't speak for Canada but in the USA the statute of limitations on collections is ten years. Also, any negative credit expires on your credit report ten years after your last payment. You need to think about that if you cut a deal with a collection agency because once you send them a payment the whole ten-year clock resets.

Here's a good rule of thumb:

If the debt is equal to or greater than your CURRENT annual income then cut to the chase and just file bankruptcy.

If it is less then cut some deals to pay it off or wait it out for the ten years.

[eureka]

If I recall correctly,all the creditors have to do is to write a demand and the clock continues to run. You don't say how much your debt is or what your ability to pay is so it is difficult to say waht might be best for you.

Have you tried credit counselling or negotiated on your own? It is usually possible to make deals that call for own only some portion to be paid.

Failing that, a consumer proposal does the same and, while a bankruptcy proceeding. it is less significant than bankruptcy and easier to recover from.

[sandorski]

Ya, I'd consider Credit Counseling. Had a friend go through that. Much easier than Bankruptcy, all Debts were consolidated and decreased to an affordable amount, and after a couple years it was behind him.