Resolving Your Debt - Page 2
FAQ
Q I mentioned to the collectors that I may file bankruptcy. They said not to because my credit will be ruined for 10 years. Is this true.
A. First lets look at who told you that. A collector. His/her job is to get you to pay the debt. He may or may not get a bonus off getting you to pay. What is true is that it will report on your credit bureau for up to 10 years. Maybe even less. Will you ever be able to get credit again? Most likely. It depends on many factors. What is true that it may be more difficult to get credit but not impossible. You may also pay a higher interest rate than you would if you had never went past due. I personally had to file a chapter 7 in 1996 after my son was in accident with medical bills over ? million dollars. 30 days after the case was finalized I was able to get financed on a 1 year old truck with no money down. 18 months later I had credit cards and had purchased a house and got it financed. There are lenders whom will finance you but they charge higher interest rates This is called "sub-prime lending" Just because you are behind on your bills and cant catch up the past due payments doesn't always mean you should file bankruptcy. Communicate with your creditor first and see what options are available, look into credit counseling to see if they can help. New laws coming into effect may make that a requirement before bankruptcy can be filed.
Q I got 4 months behind on my bills when I lost my job. I got caught up but my creditor will not fix my credit. What can I do to make them remove the bad mark against me.
A Nothing. If you where 4 months past due and they are reporting that, they are following the law. If a creditor reports they must report accurately
This quote is from the Fair Credit Reporting Act
"Reporting information with actual knowledge of errors. A person shall not furnish any information relating to a consumer to any consumer reporting agency if the person knows or consciously avoids knowing that the information is inaccurate. "
In other words, they can't report that you weren't past due if you where and vice versa. The only way they can change a report is if it was due to the fault of the creditor. (i.e. payments posted to wrong account)
However you can place a statement into your credit file that explains any derogatory info. (i.e I was behind because of unemployment) As long as that negative information is on file that statement must accompany it. It is up to the person with whom you applied to for credit who makes the decision of if you are granted credit or not. The credit bureaus do not determine if you get credit. They simply relay your score which is based a many factors such as payment history, recent inquiries, % of total credit available to you that you have used, and income to debt ratio.
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