BK advise

[GMayen07]

I find myself in a really bad place right now and I am considering filing for bankruptcy. However, over a year ago I made a purchase and I have not been able to make the first payment on that account since the purchase was made. Reason is that shortly after the purchase I was laid off and at this point I am having trouble making ends meet and I can't continue to pay the other creditors.

Can I file for bankruptcy even if I have a first payment default? or I am going to be held liable for this merchandise?


Thank you for all your help...

[lrprn]

Welcome to BK Forum, GMayen - glad you found us!

...over a year ago I made a purchase and I have not been able to make the first payment on that account since the purchase was made. ... Can I file for bankruptcy even if I have a first payment default? or I am going to be held liable for this merchandise?

Yes, you can still file for bankruptcy even if you didn't make one payment, especially if the merchandise was purchased a year ago.

How the debt will be treated if you file bankruptcy depends on what the merchandise was - what did you buy? Did you buy it all from one creditor? And how did you pay for it - credit card or secured loan from the lender?

[GMayen07]

BK Advise

Well it was electronics and it was from the same creditor. The creditor has a security agreement .I was told by someone else that it is considered a "first payment default" and that as a matter of fact I can't file for bankruptcy because it would be considered fraud!

Is there any truth to that?

Also what can the creditor do if in fact they do hold a security agreement?

[lrprn]

Well it was electronics and it was from the same creditor. The creditor has a security agreement. I was told by someone else that it is considered a "first payment default" and that as a matter of fact I can't file for bankruptcy because it would be considered fraud! Is there any truth to that?

Not true. Unless the person who told you this was an experienced bankruptcy lawyer from your local area, then that "someone else" you talked to is just plain wrong.

Also what can the creditor do if in fact they do hold a security agreement?

The creditor has the right to repossess the electronics or demand payment in full if you file and don't reaffirm the debt. However, this is a very common scare tactic - these creditors want your money, not used electronics now worth much less than the original sale amount.

Unless the electronics you bought was for many thousands of dolllars and has a good resale value, then most bk lawyers will tell you not to reaffirm. If the creditor calls or sends letters threatening repossession, tell them they are welcome to come pick up their old stuff. 99.9% of the time, you won't ever hear from them again.

Only you and your lawyer know what's really going on in your "electronics" situation (whatever the "electronics" are) and whether it's worth the risk to not reaffirm this debt when you file.

[JRScott]

Is this DELL?