File bankruptcy or not?

I just want to start by saying congratulations on buying Dean's books and taking the first step to a more prosperous life.

From what I have gathered through reading Dean's books and by repairing my own credit it certainly helps to have good credit when real estate investing but is not necessary for your success.

After filing for bankruptcy your accounts that were paid off through this will show up as such on your credit report, thus throwing up a red flag to possible lenders.

However it is not impossible to make money with bad credit, no credit or no money. Look in to assignments, which you will learn in Dean's books. Also look into joining an REI club where you can meet other investors who could loan you money to get your REI career going.

If at all possible try to avoid bankruptcy, but if there is no other way, you gotta do what you gotta do.

Just know that you have a support system right here with the DG family.

I wish you all the best in your endeavors. Feel free to send me a PM anytime you want to.

I agree with "Going For It All." it is a bad idea. First you have to consider your circumstances; are you unemployed, is illness a factor. I know the credit companies are making a mint with escalating interest rates. But we have to remember we used the services offered by the creditors. In filing bankruptcy, it creates a negative concerning your reason to pay in the future. Even with using other people's money, problems will arise. Start by paying off your small accounts first with minimum amount on the higher accounts. Every time one is paid off, celebrate your success, until all is finally paid off. It can be done. However, if your real estate investing brings you enough money, you could pay it off altogether. You will have such a good feeling doing it this way. Bankruptcy remain on your credit report for 7 - 10 years. Treat being debt free as an investment into your future and make it happen. Welcome to the DG family and your new career in REI. All the best.

Sandra

I am presently not employeed and only living on a small retirement that is not near enough to live and pay on my debts also. Several of my debts have already gone to judgement and not possible to repair. My divorce has left me close to $60,000. in debt and due to recent back surgery have been out of work or any steady income.

Thank you for the information and I will finish reading the books and looking into an REI club.

I need all the help I can get!

I've been there and done it, including a foreclosure. It is not an easy situation to take on. The stress level is Mach 10. Looking back, if I could do it all over, I would fight it until the very end. Trust me, it is not a great feeling to be at the bottom of the barrel looking up. From a banks point of view it is a black mark on you for quite some time, but you can work your way back up to the top. You have got Dean's book, try putting it to use. There are so many ways to make money in RE, it is yours for the taking. My heart goes out to you. Fight it.....Jan

Try to see if you could make deals with the credit companies, one at a time. They will be eager to do so, since many of them are incurring extreme losses. Never tell yourself you cannot do this. Have faith in yourself. I have been there, had humongous debts, but I am taking it bit by bit, one day at a time and getting there. I will be credit card free at the end of this year. Anyone can do this. Tell yourself you can and you will. That first deal will bring in the doe. All the best, we are here to support you.

Sandra

Get free legal help. I agree that bankrupsy is the last resort. most credit card companies will definately make a deal for a partial payment of the amount owned. there are free services that will help you with this.
ggod luck
Richie.

I suggest you speak with an attorney

Most likely you won't be able to get a home with that blemish for a few years. This is not 2003-2005 anymore.

Do what is best for you, and I suggest you just keep homeownership as a goal for the future, but if going into bankruptcy unloads alot of your stress, then there isn't much left to think about

Garpo:

Sounds like you don't have a choice, so go ahead and file Chapter 7. It's NOT the end of the world.

And your credit has already been destroyed. You can rebuild after Chapter 7 by using secured credit cards.

See bankrate.com's FAQs re same here:

http://www.bankrate.com/finance/credit-cards/10-questions-before-getting...

And as far as qualifying for a home loan in the future, you sure can! When you are 2 years away from the discharge date of your BK, you can qualify for a FHA loan with approximatey 3.5% down.

See FHA loan qualifying guidelines here:

http://www.fha-home-loans.com/loan_qualifying_fha_loans.htm

Look, you're just another victim of these times. It's not like you robbed a bank.

Good luck.

Although this was not my link, it really gave me some clarity to make the right move for me....I have tried to pay it off myself and that work for me in the past before we bought our house but, this time it is so different we only have one income and it is me, I'm giving it all I have but it is just not adding up there seems to always be a need with 3 kids. We started our home repair and renovation company to provide another string of income but the ups and downs of that just doesn't seem to add up. Heck as soon as the money comes in it goes right back out.

I am working with a lawfirm to try to save my house, working with one for bankruptcy, working with another for workmens comp case.....it is becoming very overwhelming.

Any thanks

It will stay on your record for the next 10 years. To get business credit, you may need to personally guarantee some of your accounts. It would be better to do an extensive budget and go to a credit counseling center. They do have them for free, just look up on google. Seeing as you are going for a divorce, there are many options and creative things available to you that many will help you with your divorce situation and the surmounting bills. In many cases, a lot of the debt will be forgiven; still shows on your credit, but it is NOT as devastating as a bankruptcy. (try Christian credit counseling)

Once you have your budget in place and have talked with a credit counselor, you need to organize ALL your bills. Put the ones with the least amount due on top. Pay minimum balances on ALL your bills except the one on top. Once that one is paid off, then take all the money you were paying on that bill and then begin paying on the next one down the list, so, you will now be making the minimum payment + whatever you were paying on the previous bill you paid off. Continue this until everything is paid off. Why do this?

Well, you are paying interest on your bills. By not paying the interest, you are actually making more than many investments. Say you have a credit card at 9%, (or 18%, whatever the rate), once you pay that off, then you are no longer paying the interest on that card.

To do this will require accountability and self control. You can still buy things, but you need to try to stick to your budget. Make it a priority to try to always pay with ATM, cash or check, so you are only spending cash. Once you get everything paid off, if you find you are responsible enough to pay off all your credit cards in full each month, then and only then should you use a credit card.

Using Quicken or some other money program will really help you.

Listen to PP advice, bankruptcy isn't a good idea. It will affect you negatively in more than one way, especially when you start your real estate business!

If you already have a business, stop paying for business expenses with personal credit. Biggest mistake people make (myself included!). A great book to get to help you build your business credit is How to Build Business Credit and Get $100,000 for your business is 120 days by Norman David Roussel. There's even a company in there at the end of the book that will give you a loan for your business to help pay off your business expenses.

Remember: "With God all things are possible." Matthew 19:26 You will be able to do this without filing bankruptcy. Try http://www.anewbf.com/ but make sure you tell them that you want to pay off the debts one at a time instead of consolidating them all at once. Its much more efficient that way!

If I had it to do over again I would do everything possible not to file.

Randy

Okay so I have talked to 2 modification company since the last post and one offers credit repair with there program (I like that) so we have decided to focus on saving our house and move on from there after the credit repair....We will not have a house payment through the process so with this money we plan to pay on some of the debt (if that is ok with the program).

I have pulled all my credit reports and got one of my scores to get an idea where we are it was not as bad as I thought it would be. So we will keep moving from here.