Consult a Bankruptcy Attorney When Assistance Needed
Video Transcribed: Oklahoma Bankruptcy Attorney Edward Kelley here, answering your Oklahoma bankruptcy questions with oklahomacitybankruptcyattorney.pro. So today we’re going to talk about what happens after your bankruptcy. A question I get a lot. So as you might recall, from other videos, there is a reaffirmation process for generally secured loans with collateral you want to keep. I’ll refer to my other video on your home.
Generally, you don’t necessarily want to reaffirm your home because it doesn’t help you and you don’t lose it just because you don’t. However, personal property, the bankruptcy code does give creditors the right to reclaim that collateral.
Even if your current, if you don’t reaffirm the note during the bankruptcy. So when can you do that? That’s from, your deadline is going to be your date of discharge. So generally you’re going to start getting those right after you file and they need to be filed before that discharge, which is about 90 days out.
So generally you have that amount of time. And I usually start and finish that process within a week or two of the 341 creditor meeting. So that’s between day 30 and day 40/45 I get that done, but you have 60 days from that creditor meeting date. So make sure if you haven’t talked to your attorney, but everything at that creditor meeting, you remind them, Hey, I need to reaffirm this car.
You know, and I have seen creditors, they never used to do this, but even if people current on their car, if they don’t reaffirm that just repo it and they are allowed to do that. So what happens after bankruptcy? Hopefully you’re reaffirmed on everything that you wanted to keep. If you didn’t, and then it’s repoed do take comfort in that they can never go after you personally because that debt was discharged, which is why they have that right to do that.
Generally, what I find most people’s credit score is in terrible shape anyway, when they file bankruptcy. Your credit score is about half your debt to income and about half your good payment history. They look at how much debt you have and that brings your credit score down. So a bankruptcy actually dramatically improves that side of it.
And most people already have terrible payment history anyway, going into bankruptcy. So the bankruptcy actually improves it. Also lenders know that once you file bankruptcy, you can’t do it again for eight years as we discussed in the last video or you can’t do a chapter seven.
So they’re more inclined to lend to you at that period. So I find that most of my clients get some water flooded with subprime offers, credit cards with really high interest rates or variable interest rates or lots of yearly or monthly fees or combination of all of the above.
And you may get a car loan with a pretty bad interest rate. So beware you’ve done this to get a fresh start. Don’t take some terrible credit cards. What you can do is get one card, usually capital one’s a good one, not a terrible interest rate. And it’s a regular legitimate card without fees, monthly or yearly fee.
Get one and keep it with about a 30% balance. That seems what I’ve heard from experts. That seems to be the magic number, use it for everything and pay it off every month and keep it at that 30% balance. Don’t pay it off completely. So that’s for chapter seven people.
Anyway, that’s usually a snapshot of how things look. You’ll probably get lots of credit offers. You need to be careful about that. Obviously you got in trouble last time. So try not to use credit for anything.
And you’re only using a credit card to rebuild your credit because you want that card to report every month that you carrying that 30% balance and paying off the rest every month, every month, every month. And actually the more, the fact that you have credit available will help you as well.