Banks won't help

[HHM]

I'm rebuilding credit ASAP after discharge as a safety-precaution. The credit-limits on my CCs I obtained after discharge are either secured or so small that they don't threaten my financial health. Honestly, I doubt I have to file for BK again due to a $300 CL CC. My biggest loan I obtained post-BK is a $4,000 installment-loan - again, 100% secured and already prepaid 'til August.

I see it this way: Although I don't want to rely on credit any more, I certainly don't want to be penalized by the system for NOT rebuilding credit in case I need it again. Why should I give up the opportunity to get a higher credit-score?

But you are fundamentally misunderstanding how credit works...After BK, MORE THAN ANYTHING ELSE, time heals your credit. And again, I will point out "mindset" the idea that credit is for "emergencies" the fundamental trap of credit. I am not talking about having to file BK, it is about ever being in the position to have to rely on credit. Let me put it this way, if over the next 10 years, you had $500,000 in the bank...do you think you would really need credit.

I know my position may seem extreme, but the reality is, only the middle class relies on credit (the poor can't get credit, and the rich don't need credit...the problem is, the middle class try to live like they are rich).

[IBroke]

I'm rebuilding credit ASAP after discharge as a safety-precaution. The credit-limits on my CCs I obtained after discharge are either secured or so small that they don't threaten my financial health. Honestly, I doubt I have to file for BK again due to a $300 CL CC. My biggest loan I obtained post-BK is a $4,000 installment-loan - again, 100% secured and already prepaid 'til August.

I see it this way: Although I don't want to rely on credit any more, I certainly don't want to be penalized by the system for NOT rebuilding credit in case I need it again. Why should I give up the opportunity to get a higher credit-score?

[HHM]

my credit does affect my employment it is not as you say "poppy cock". I had to go through a lot of scrutiny and explaining about my credit and my bankruptcy and show a new positive history.

The exception that proves the rule...you didn't lose your job because of BK. I have worked with many that have had Top Secret clearance and not one have lost their job. And guess what, they didn't actually have to do anything afterward except make sure things were reporting properly. Don't misinterpret, I did not say BK is "not a factor", but as you have experienced personally, it is NEVER the deciding factor.

As always, people miss the point...the issue is mind-set toward credit, not credit itself. When someone comes out of BK and is anxious to "rebuild" it indicates (not proves, but indicates) an improper mindset toward credit and the "need" for credit. Here is the thing, if you NEED credit for anything, (even a house) that means you have been living beyond your means at some point. That is the fundamental issue.

[Amy26]

Hehe... ah, the age old debate. I don't want to get too much into it...yet again.... But, I will just say that I also disagree with HHM. What we say in rebute to you are not "excuses" ... they are opinions ... just like your "opinion". I actually find it amusing that people think the only way to live after a BK is in sole denial that credit even exists and to divorce yourself from it completely. Just because people are getting credit again and g-a-s-p USING IT doesn't mean they have turned to the dark side or swallowed some evil pill from the devil. It just means that is how they chose to spend their time and money.

Yes, DEAR GOD IN HEAVEN, some people carry balances after BK... yes, people get 2-3 credit cards and use them... and you know what, some people just might get into a bad situation again. But, that is their fault and their problem and none of our business. If people haven't learned their lessons and cannot act responsibly with their credit then its certainly none of our business to judge and they need to lie in their beds. All we can do is provide advice, personal experience and share our "opinions".

I will not be judgemental and say things like people who live a cash only lifestyle are silly, or spout excuses or live in denial etc etc... everyone has the right to their own opinions and I think people should lead their lives how they wish. There are many different opinions on this board but I really get a little unnerved when people start bashing the other side. I am not poking at one person or one post, I am speaking in general as a whole and my years of being on this board.

Credit is certainly a double edged sword and you definately need to be careful and use it wisely ... post BK or not. Just because we are post BK doesn't mean we are credit idiots or flunkies of the school of credit ... it can mean a variety of things. We just need to learn, adapt, educate ourselves and act responsibly how we see fit and then just try to help people when they ask and share our experiences.

Oh and for the record... as tada mentioned as well... I have a top secret clearance... and yes HHM, my credit does affect my employment it is not as you say "poppy cock". I had to go through a lot of scrutiny and explaining about my credit and my bankruptcy and show a new positive history. They are also going to scruitinize me again when I am reevaluated when my clearance is up for renewal. If they did not believe that I was capable of being financially responsible and handling my debts and my credit going forward (and previously) then I could have lost my clearance and my job.

[Logan]

If my spelling sucks it's because I'm killing time on a life cycle typing on an iPhone.

[Logan]

I appreciate your advice in this matter, but I have to disagree.

My wife and I lost our jobs. She lost hers a year before I did. So, even though we had spotless credit, we were unable to meet our obligations. They were not excessive. But we wanted to hold on to our house which we had about $20k in equity. So we lived on my $1680 a month of my umemployment, made a first mortgage payment of $1513, and a second of $539, on a $285,000 house. We cut all expenses - food, gas, cell phone, cable, etc. We exhausted our savings just trying to stay alive. This is not bragging or whining, just the facts. In many ways we are lucky compared to some situations I have read about here. I have been an electrical engineer for 28 years, and found myself out of work for 7 months. So we found ourselves needing to file, in the hopes of ridding ourselves of non secured credit debt. We are lucky enough to own our cars.

We really did learn our lesson the hard way. And for the record, we filed Ch 7 on 11/24/10 and were discharged on 3/2/11. My case is still open because the trustee is waiting for 90% of our tax return.

I found work and regained my income. My wife still is unemployed, but with a fresh start, we are able to do ok on my income. Like I said, I feel lucky. But we did a ride through on our mortgage. And we are very safe and stable people, and we want our home refinanced. We have an 8 year old ARM on the first mortgage, and we are lucky it adjusted down for the last few years - now at 3.25%. But we can't bet on that forever. So, to attain the goal of a refinance in two years (FHA guidelines), we need to re-establish ourselves.

And I'm not going to wait and do nothing for two years. I will diligently clean up our three reports and establish the minimum amount of credit to meet our goals. I do appreciate all of the tips I have gathered from members of this forum.

We don't want new cars. We don't want huge credit debts. All we use the CapOne card for is to buy gasoline for my commuting. Nothing else. We pay cash for everything else. I wouldn't call that excessive.

All I wanted to do with a larger bank was to deposit money in an account, get a secured loan, and have the loan pay itself off. A totally hands free move. Just to establish an installment loan, on top of a small revolving credit card with CapOne that reports to all CRAs. And my local credit union only reports to one credit bureau. I have since joined NFCU and will work with them, maybe on a credit card, but definitely on a secured installment loan. My attorney told me that a credit card and an installment loan would look very good to a mortgage broker or company. Because of the ride through, my first and second mortgage lenders - Citibank and Aurora Loan Services, refuse to report on time payments, so they do nothing for my credit rebuilding effort.

As far as employment goes, I carry a DoD security clearance where I have to report financial problems and bankruptcy. My clearance is reivestigated every five years. And to mitigate the possibilty of revoking my clearance, I have to show that I can responsibly handle my debts. Mitigating the BK just discharged will take the remaining four years of good credit performance, not just living on cash with no credit. During the investigations, I have credit checks run, and will have to have a Special Investigator sit down with me while I explain my situation.

I'm sorry for the long response, and I told you way too much about my situation, but I wanted to clear the air. This is not about the fervor of returning to debt. It is about rebuilding my credit score. I think we have learned our lesson - the biggest lesson was to return to school and get a Masters degree so that I hopefully remain employed for the rest of my working life. Poor spending habits may have contributed to our BK, but unemployment drove us to it. I worry about my reinvestigation when it comes up. We don't want the credit other than to refinance our house - to provide a little stability to a loan that can go up in interest rates. And in reality, the lenders could just foreclose, sell the house, and take the profits. I doubt they will, but it is a possibility.

Thanks for reading, Tom.

Why dont you speak with nfcu and ask them what you need for a mortgage. A lawyer is just that, a lawyer and does not work directly with borrowers everyday. So before you get an installment loan and waste money on interest get some advice from NFCU and a mortgage broker.

I used to be a loan officer. Your lawyer may have some good ideas but ask the people who will get you your new loan.

Logan

[Logan]

When were you discharged?

I have to say, these sorts of threads are actually depressing...the fervor with which people want to get back in debt and the mis placed importance placed on a credit score means that after going through BK, you haven't learned the FULL lesson bankruptcy. I know the excuses will start flying....blah blah blah, want a house, it effects employment (poppy-cock). Most wealthy, truly successful people are actually credit ghosts because they DON'T USE CREDIT. It is not actually unreasonable to think you can buy a car for CASH and g-a-s-p, buy a house.

It is the one piece of propaganda, the importance of credit score, that somehow survives the BK process.

It does seem that many here are aquiring cc's and carrying balances. If you want to reestablish credit get 1,2 or how many ever cc's you want but just put 1 charge a month on each card and then pay it off when your statement comes. Pay the dang things off and on time every month and your credit will rebuild. Make a plan, impliment your plan and don't over think it.
The media has us obsessed with our credit. It's really quite simple-pay your bills on time!!!

Logan

[tada]

When were you discharged?

I have to say, these sorts of threads are actually depressing...the fervor with which people want to get back in debt and the mis placed importance placed on a credit score means that after going through BK, you haven't learned the FULL lesson bankruptcy. I know the excuses will start flying....blah blah blah, want a house, it effects employment (poppy-cock). Most wealthy, truly successful people are actually credit ghosts because they DON'T USE CREDIT. It is not actually unreasonable to think you can buy a car for CASH and g-a-s-p, buy a house.

It is the one piece of propaganda, the importance of credit score, that somehow survives the BK process.

I appreciate your advice in this matter, but I have to disagree.

My wife and I lost our jobs. She lost hers a year before I did. So, even though we had spotless credit, we were unable to meet our obligations. They were not excessive. But we wanted to hold on to our house which we had about $20k in equity. So we lived on my $1680 a month of my umemployment, made a first mortgage payment of $1513, and a second of $539, on a $285,000 house. We cut all expenses - food, gas, cell phone, cable, etc. We exhausted our savings just trying to stay alive. This is not bragging or whining, just the facts. In many ways we are lucky compared to some situations I have read about here. I have been an electrical engineer for 28 years, and found myself out of work for 7 months. So we found ourselves needing to file, in the hopes of ridding ourselves of non secured credit debt. We are lucky enough to own our cars.

We really did learn our lesson the hard way. And for the record, we filed Ch 7 on 11/24/10 and were discharged on 3/2/11. My case is still open because the trustee is waiting for 90% of our tax return.

I found work and regained my income. My wife still is unemployed, but with a fresh start, we are able to do ok on my income. Like I said, I feel lucky. But we did a ride through on our mortgage. And we are very safe and stable people, and we want our home refinanced. We have an 8 year old ARM on the first mortgage, and we are lucky it adjusted down for the last few years - now at 3.25%. But we can't bet on that forever. So, to attain the goal of a refinance in two years (FHA guidelines), we need to re-establish ourselves.

And I'm not going to wait and do nothing for two years. I will diligently clean up our three reports and establish the minimum amount of credit to meet our goals. I do appreciate all of the tips I have gathered from members of this forum.

We don't want new cars. We don't want huge credit debts. All we use the CapOne card for is to buy gasoline for my commuting. Nothing else. We pay cash for everything else. I wouldn't call that excessive.

All I wanted to do with a larger bank was to deposit money in an account, get a secured loan, and have the loan pay itself off. A totally hands free move. Just to establish an installment loan, on top of a small revolving credit card with CapOne that reports to all CRAs. And my local credit union only reports to one credit bureau. I have since joined NFCU and will work with them, maybe on a credit card, but definitely on a secured installment loan. My attorney told me that a credit card and an installment loan would look very good to a mortgage broker or company. Because of the ride through, my first and second mortgage lenders - Citibank and Aurora Loan Services, refuse to report on time payments, so they do nothing for my credit rebuilding effort.

As far as employment goes, I carry a DoD security clearance where I have to report financial problems and bankruptcy. My clearance is reivestigated every five years. And to mitigate the possibilty of revoking my clearance, I have to show that I can responsibly handle my debts. Mitigating the BK just discharged will take the remaining four years of good credit performance, not just living on cash with no credit. During the investigations, I have credit checks run, and will have to have a Special Investigator sit down with me while I explain my situation.

I'm sorry for the long response, and I told you way too much about my situation, but I wanted to clear the air. This is not about the fervor of returning to debt. It is about rebuilding my credit score. I think we have learned our lesson - the biggest lesson was to return to school and get a Masters degree so that I hopefully remain employed for the rest of my working life. Poor spending habits may have contributed to our BK, but unemployment drove us to it. I worry about my reinvestigation when it comes up. We don't want the credit other than to refinance our house - to provide a little stability to a loan that can go up in interest rates. And in reality, the lenders could just foreclose, sell the house, and take the profits. I doubt they will, but it is a possibility.

Thanks for reading, Tom.

[tobee43]

yikes..i guess i'm not the only one have a problem with the double postings with the site this morning. anyway, i so agree with hhm, people who say their credit stayed intact after filing, well, i do believe it is possible for a few things to slip through the cracks, but not a general rule at all.

we had numerous zero balanced pd in full accounts we had never been late on in 40 years. it took a few months, but the companies closed all of them because of bk. not one survived. and just a note, our credit scores were 690 and 685 (not really bad my most standards), after our bk and we can't buy a hill of beans on credit at this point.

[HHM]

When were you discharged?

I have to say, these sorts of threads are actually depressing...the fervor with which people want to get back in debt and the mis placed importance placed on a credit score means that after going through BK, you haven't learned the FULL lesson bankruptcy. I know the excuses will start flying....blah blah blah, want a house, it effects employment (poppy-cock). Most wealthy, truly successful people are actually credit ghosts because they DON'T USE CREDIT. It is not actually unreasonable to think you can buy a car for CASH and g-a-s-p, buy a house.

It is the one piece of propaganda, the importance of credit score, that somehow survives the BK process.

[HHM]

When were you discharged?

I have to say, these sorts of threads are actually depressing...the fervor with which people want to get back in debt and the mis placed importance placed on a credit score means that after going through BK, you haven't learned the FULL lesson bankruptcy. I know the excuses will start flying....blah blah blah, want a house, it effects employment (poppy-cock). Most wealthy, truly successful people are actually credit ghosts because they DON'T USE CREDIT. It is not actually unreasonable to think you can buy a car for CASH and g-a-s-p, buy a house.

It is the one piece of propaganda, the importance of credit score, that somehow survives the BK process.

[DebtHater]

I guess only CapOne is going to help me with all three credit bureaus. I could probably do a car loan with CapOne, but I don't want a car payment.

Don't feel flattered that Crap One is helping you. They don't help anyone but themselves.

Realistically, they are no different than Chase, BOA, or any of the other big banks. They use the same deceptive practices as the others and lie about it. They attempted to "help" me prior to filing BK and offered me a payment plan. The only problem was they would refuse to put their offer in writing. As far as I'm concerned if it's not in writing, it's doesn't existent. The reason is Crap One doesn't put their "offers" in writing is because they have no intention of upholding their offers. When someone is gullible enough to give them electronic access to their checking account, it gets wiped out. Sure, we'll only deduct $200 from your account. Then $200 more, and $200 more.....

Trust me when I say that when banks "refuse" to help you, they are really doing you a favor by not doing business with you.

[reddy2011]

Really great discussion abt this topic

[egeitz]

you will see after bk there are many banks does not want your business like chase boa to name a few. also there are many cc you cannot applied because of bk like amer. express, chase discover etc

[IBroke]

tada Have you thought about a secured credit card to help you rebuild your credit? like Bank of America...

Don't waste an inquiry on BoA. They DO NOT APPROVE you after a BK - not even for a secured card!