Should I File Or Not? Streetwise Advice Needed

[Clipper965]

HELLO:
I owe approx 40K in Medical/Dental bills spread across several cards. Most appear on my credit report as Charge Offs but 2 major ones still report the account as past due. Last Payment made on most of these cards was summmer of 1998. I have toyed with Filing Chapter 7 since then, Many of my accounts went to collection agencies and I keep them away with the standard CEASE & DESIST LETTER, but my concern is my ability to rebuild my credit with this hanging on me. I don't earn near enough to pay this back. My friends and family have said " You don't have anything they can take away from you, no home, assets. so why file?". Should I file and put this past me?. I do not want to but am worried I will never again be able to "start over" and get all these past problems past me if I do not.

 

[bigun]

Don't file yet. The SOL on cc debt in Fl. is 4 years. You need to find out the last time you made a payment on any of these cards in order to find out when the SOL runs out. Caution, if you get sued past the SOL date, you must apear in court and present the SOL defense. If not, you'll lose by default. I'd do nothing this far into the game unless you are sued.

 

[gottago]

If nobody sues you, you'd be crazy to file, especially if your credit is your main concern.

Those debts are already almost 4 years old, and will fall off your reports 7 years after you made the last payment on each of them. If you file bankruptcy, you'll have a huge nagative mark on your report for the next 10 years.

3 more years or 10 more years..... it's your choice.

 

[Clipper965]

Suppose.........

Suppose I do get sued?.

 

[gottago]

THEN you file

If you are served with a summons to appear in court for one of these debts, contact a bankruptcy attorney immediately and discuss your options. If you choose to file at that point, the automatic stay issued by the bankruptcy court will stop any legal proceedings.

Filing an emergency bankruptcy petition takes 5 minutes, and it stops a creditor from taking any further action.

 

[Clipper965]

Wage Garnishments

Do you think they might try and do a wage garnishment?. If they try will I have warning enough to file before my employer is involved?

 

[bigun]

No one can garnish your wages until they have filed a lawsuit and then won. If you've not been sued, a wage garnishment isn't on the horizon.

 

[gsweetsue]

so when should one just let credit run unpaid and not ever file. i have 2 older cars and home equity in FL. nothng much else

 

[bigun]

Sue,

That's a decision dictated by the circumstances. The thread starter is so close to beating the clock that it would have made no sense to file now.

You on the other hand are very new in the game. From your other post, I'd doubt you are even at the chargeoff stage. Also, it depends on how aggressive the collection activity is. If you've not been sued, I'd try not to file. Filing bk will be on your credit report for 10 years plus, many insurance companies will not underwrite anyone with a bk. Bk will always be an option. I'd try and make it the last option if possible.

 

[Clipper965]

More Questions........................

I recently got a copy of my credit report and a large account that I last paid on in 1997 is still being reported as open and deliquent as opposed to charged off or something like that. You said that the Staute of Limitations is 4 years but will they continue reporting this to the credit bureau?. My other concern is marriage. If I marry soon I do not wish my future wife to be a part of my financial problems. Is the only way to prevent this is filling Chapter 7?. I am writing you again because the 4 year statue of limitaitons is about to kick in on several of my old debts last paid in 1998. I fear the next several months will be an all out attack. I have the standard CEASE & DESIST letter I send to the collection agencies which has kept them at bay for 2 years or so. I have $2000 in a savings account which is Student Loan Money to pay for classes and such. If I file how would I treat this on my forms. I cannot afford an attorney and do not qualify for Pro Bono help from the Bar Association Legal Aid Society as they do not deal in Bankruptcies.

 

[bigun]

Clipper,

Calm down! First of all, the SOL on cc debts in Fl. is 4 years. But, derogatory information will be on your credit report for 7 years. One has nothing to do with the other. You are so close to beating the clock, I'd not file unless I did get sued. Just keep the C&D letters at the ready and hope you slide through. You can always file bk if you do get sued.

 

[Clipper965]

I am unclear on these Statues of Limitations. Does this mean once I "beat the clock" they can no longer legally try and collect the debt?. In the event I would have to file BK what bout the School Loan money I have in my Account.

Thanks for all the help!

 

[bigun]

Clipper,

These debts will never expire unless you file for bk. However, if they are past your states SOL and, you get sued you must show up in court and cite the SOL defense. Chances are once the SOL runs out, creditors will leave you alone.

If you file for bk, that will be on your credit report for 10 years. If you don't file and avoid being sued, these chargeoffs will disappear in another 3 years and you start over with a fresh slate.

Every state will allow you to exempt a small amount of cash in bk proceedings. Some of that will be exempted. You'll have to discover what the Fl. statues allow.

 

[Clipper965]

BUT...........

I just got my most recent credit report from Trans Union, many of the bigger debts have been sold to others. Where does the Statue Apply?. From when the original creditor sold it?. Or when the debt changes hands it becomes a new one?

 

[bigun]

The SOL clock begins with the first continious delinquency that led to the chargeoff. You said the summer of 1998 is the last time you paid anything. For ex. if the last check you wrote the cc company was July of 1998 then, you went continously delienquent in Aug. of 1998. That is when the SOL for Fl. would start. They can swap the debt around until the end of time but the bottom line is they cannot reage it. That is illegal. Just try and relax. Has anyone contacted you recently? If you have a good idea of the exact month you defaulted, I'd wait until that month passes before I accessed anymore credit reports. Just try and lay low.