top Ad Widget

Collapse

Announcement

Collapse
No announcement yet.

To rebuild or not to rebuild...that is the question

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    To rebuild or not to rebuild...that is the question

    Reading the other thread about rebuilding credit, it's obvious that this subject can get heated. Personally, I am starting to look at my long-term financial health for after the discharge. I took Dave Ramsey's Debtor Education course, and I like the framework he proposes. This is my personal choice.

    For a variety of reasons, I do not plan on owning a home. I like renting, and have moved around enough that it makes more sense for me to rent. So, no need to rebuild credit for that purpose.

    I am willing to pay higher insurance rates as a consequence of my past mistakes. I am single and have no children so I have no excuse to buy things I can't afford with cash. In addition, I have a student loan that will take some time to pay off, so that will help to rebuild my credit. The one thing that gives me pause is what about employment?

    Most employers run credit checks when offering a job. While I am gainfully employed with a good company, I was laid off twice in two years (thank you Michigan.) Therefore, in this economy I take nothing for granted. I would be personally happy to never have another credit card...but if having one and using it responsibly will rebuild my credit sooner, is it worth it? Any advice from those post-BK with this experience would be wonderful.

    Thanks a ton!
    A fresh start is a beautiful thing. And I'm not an attorney, just opinionated!

    #2
    Hey discombob1,

    Though I don't have post-BK employment experience I am having during-BK employment experience. It's a securities related position, so I do have licensing requirements, etc. My final interview was this morning and I was told next step is background, and was asked if I had any red flags to disclose. I disclosed BK (active, non-discharged) and was told they'd follow up with HR, which in turn called me and followed by sending me the app and background paperwork, while telling me that in the past, bk by itself has not been a precluding condition. So we'll see, I'll fill out forms this weekend, send them in Monday, and I'll keep the board posted. This is a large very prominent company and the position they are recruiting me for is a mid-level, high-visibility role.

    Here's the link where I've been documenting this hoping to give others some insight into the process and how it's viewed. I thought this would be relevant to your question.

    Stopped paying: 08/10, Filed CH7: 08/27/10 , 341 & No Asset Report: 10/6/10, Last day to object: 12/06/10, Discharged: 12/07/10, Closed: 12/08/10
    AHEM.....NOT AN ATTORNEY, NOT ADVICE, ETC, ETC

    Comment


      #3
      If you do not ever want to buy a house, or live in a large apartment complex that checks credit, then you have much less reason to repair your credit than many of us. If you are a Dave Ramsey fan, and want to try his approach to simplifying your finances, then that sounds like the best approach for you.

      However most employers do background checks these days. I had one when I took a new job in January, and I just had another one because my company is being bought by another company. I am a principal analyst for a venture firm, so the background checks are in depth ones. My background check checks for public records, so my bankruptcy was sent to HR of both my old company and the new company that is buying us. Even when you are employed there is no guarantee that you will not have periodic background checks. Ymmv.

      For background checks it is not necessary to get new trade lines and rebuild your score however. Cleaning up your negatives is what is important. If you know that you are never going to buy a house or a car, then there is no immediate need to re-establish positive trade lines.
      You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

      Comment


        #4
        Thanks for the replies! I do often go through background checks as I have a professional license and it never even occurred to me about public records. I do have 2 judgments I have to work on after discharge, and I plan on cleaning up my report as necessary to make sure everything is at least accurate. I am throwing around the idea of a secured card that will report to CRA's, but haven't decided. I do love the idea of being completely debt-free. It seems like it shouldn't be such a tough decision...lol. Guess once you've been through the BK ringer you become gun shy, rightly so.
        A fresh start is a beautiful thing. And I'm not an attorney, just opinionated!

        Comment


          #5
          Originally posted by discombob1 View Post
          Thanks for the replies! I do often go through background checks as I have a professional license and it never even occurred to me about public records. I do have 2 judgments I have to work on after discharge, and I plan on cleaning up my report as necessary to make sure everything is at least accurate. I am throwing around the idea of a secured card that will report to CRA's, but haven't decided. I do love the idea of being completely debt-free. It seems like it shouldn't be such a tough decision...lol. Guess once you've been through the BK ringer you become gun shy, rightly so.
          Getting a credit card does not get you into debt unless you use it and don't pay it off right away. Your score will improve much faster with positive trade lines on your report than without them, all other things being equal. Getting a secured card, charging a cup of coffee on it once a month, and paying it off immediately is not going to get you in debt, and will help your fico score if fico scores matter to you. As far as background checks, public records are checked for and the information is sent to your employers, so be ready for that, and get your judgments vacated once you are discharged so that the bk is the only public record showing.
          You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

          Comment


            #6
            Before getting too much into a tizzy over background checks, you have to define them.

            I would say 90% of the time, they are looking to make sure you didn't murder anyone, have 400 unpaid traffic tickets or are just a deadbeat. They are very rarely looking at your financial background. This is a common mis-perception in the marketplace. Now, if the job is financial related as some of the posters in this thread well then.....yes, it could become an issue.

            I had to have an extensive background check done on me for my job and nothing ever came up about my finances.....because my job would allow me to be the worst abuser of my finances in history and they wouldn't really care. What I do has nothing to do with money.

            I am also a Ramsey fan, and his principles work. They work because they are just common sense. He doesn't have a magic pill formula, he just motivates people and tells them what deep down inside they know is right. It's the same advice your grandparents would have given you, and he even uses that as his little tag line. His motivational skills and the fact that he is pretty entertaining is why he is one of the top talk radio shows in the world.....not because he is giving ground breaking financial advice.

            I don't think I need to tell everyone how I feel. The way I look at it is this. I tried my way, I ended up in BK court. Now, I am trying something different. I can honestly say that there is no comparison. Being able to sleep at night is a wonderful thing......minus right now of course (my son is sick!)
            New Orleans: Home to the World Champion Saints, the biggest enviromental disaster and the biggest natural disaster in the history of this nation. Proud to call it home!

            Comment


              #7
              To the OP...I have worked in the Corporate sector most of my career and have worked closely with HR matters and with HR. Briefly, the best thing anyone can do when they have applied for a job and get an interview is to try to research that company or agency as much as possible as to their hiring practices. Just take it for granted that most places will do a credit and background check in today's world. Most places are required to do that for insurance and legal purposes (trust me on that one...). Of course the credit checks will show your credit and any active BK that still may be on your credit records. The background check could just check to see if you have any felonies on your record. However, sometimes a more extensive background check may be done by the company that will include extending into other areas, i.e., whether or not you EVER filed bankruptcy (many of us have seen that question on applications or employment forms). If you check "no" to that box and the more extensive background check is done and they see the BK there (it does not go away on public records), you have just lost the job for lying.

              The best thing to do for any job interview is to do your homework on the company, be prepared to answer any and all questions that could arise as to any background issue and when prompted to disclose information, be honest and forthright. Again, this is a company to company thing that one needs to try to investigate as to its hiring practices. If a company likes your skills, background, etc., it will do all it can to hire you even with a BK on your record. Remember also in today's world competition is tough for every position so the more you sell yourself and your skills and experience and being honest and forthright, the better your chance is to get your foot in the door.
              _________________________________________
              Filed 5 Year Chapter 13: April 2002
              Early Buy-Out: April 2006
              Discharge: August 2006

              "A credit card is a snake in your pocket"

              Comment


                #8
                I totally agree with Flamingo. I would also add that typically a background check gets flagged if there are more than one or two "discrepancies". (ie differences between what you put down on the application and what was verified). I had my most recent background check (the one I just had as an employee) come back to my employer as flagged because I had put down too little salary for one of my past jobs (by mistake) and because the date of leaving a past job was a week off. (Again by mistake). There was no issue, because those are both minor discrepancies, but the point is, that if you are in financial services, the background checks can get very extensive.

                I also agree with LSU that for the vast majority of jobs that are not in the financial sector or in a government agency, background screens are simply a quick credit check, a felony check, a public record check and a driving record check. Many jobs do not even do the credit check. As with anything ymmv.
                You can't take a picture of this. It's already gone. ~~Nate, Six Feet Under

                Comment


                  #9
                  I appreciate the responses! I don't work in financial services nor do I plan to. It sounds like the consensus is that rebuilding credit will have less impact on a job app as long as one is truthful, has excellent skills and researches the company. Thanks all!
                  A fresh start is a beautiful thing. And I'm not an attorney, just opinionated!

                  Comment

                  bottom Ad Widget

                  Collapse
                  Working...
                  X