Pls. help me settle a debate over debt & bankruptcy

Long story short, my friend is engaged to someone who was previously married. According to him, she was "crazy" (isn't that what they all say). After they seperated she took their car (which was in his name) and didnt make the car payments; he also refused to pay them being she had the car so it got repoe'd. She also opened a bunch of credit cards in his name and max'd them all out obviously leaving him with the debt which he was responsible for. He never filed for bankruptcy and is still paying off the credit cards after 10 yrs. I told her that they will most likely have a problem purchasing a home (which they want to do soon). So, my questions are:

1) Is it better to file for bankruptcy or have credit cards that are being paid late or not at all?
2) Which stays on your credit longer, the bankruptcy (I think is 10 yrs.) or the late/unpaid credit cards (doesnt this stay on forever)?
3) Which affects your credit more negatively?

TIA,
Crissy

Re: Pls. help me settle a debate over debt & bankruptcy

Backruptcy should be an absolute last resort. He should make an appt with a credit counselor.

Re: Pls. help me settle a debate over debt & bankruptcy

have to hijack and say that your so is SO adoreable. total gerber.

Re: Pls. help me settle a debate over debt & bankruptcy

Re: Pls. help me settle a debate over debt & bankruptcy

If she opened the CCs in his name without his knowledge didn't he file a police report?

Re: Pls. help me settle a debate over debt & bankruptcy

The answer to these questions depend on a variety of factors and are not the same in every situation. I'm a bankruptcy lawyer and there are situations in which bankruptcy is necessary but this may or may not be such a situation. Most people know for themselves when they have gotten to that point and they go into it knowing that there are no other options. If, as you say, this person has been making payments for 10 years, there may not be much debt left, so there would be no reason to file bankruptcy. We also don't know what bankruptcy Chapter he would be eligible to file under and that would affect the decision. For some people, their credit is already to the point where a bankruptcty does not add much injury. For others it is a huge blow to their credit. Unless you have seen his credit report and a list of other debts not yet reported, know his income, expenses and assets I don't think you can get a clear answer for him. Maybe you do have that info, it just wasn't clear.

Re: Pls. help me settle a debate over debt & bankruptcy

I think your friend should make sure he is really responsible with money to get married. I mean, he cut off his nose to spite his face by not making those car payments, and if the CCs were obtained fraudulently in his name, he should have disputed that with the CC company when it started... He has been letting this go for quite some time.

I hate to poke my nose where it does't belong, but he's either lying about how all this happened or extremely bad and irresponsible with his finances... Whichever is the case, they should work out before getting married and buying a home together.

I don't buy that it's his ex-wife's fault. He could have run damage control a long time ago.

Message edited 7/13/2007 1:00:34 PM.

Re: Pls. help me settle a debate over debt & bankruptcy

if you file for chapter 7, you can't open another cc account for like 7 years...I think that delinquent credit cards are better on your credit report then a bankruptcy...how is your friends credit?

Re: Pls. help me settle a debate over debt & bankruptcy

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Message edited 7/13/2007 1:02:38 PM.

Re: Pls. help me settle a debate over debt & bankruptcy

Message edited 7/13/2007 1:10:00 PM.

Re: Pls. help me settle a debate over debt & bankruptcy

Posted by jellybean1420

I hate to poke my nose where it does't belong, but he's either lying about how all this happened or extremely bad and irresponsible with his finances... Whichever is the case, they should work out before getting married and buying a home together.

This is how I feel. Something just doesn't add up.

And in response to the other questions, he never filed a police report and supposedly he did fight the cc companies on it, but didn't get anywhere. Apparently he just didn't want to deal with his ex-wife so he didn't want to take it any further.
According to her, his credit is horrible to say the least. And I dont even know what her credit is. She is 24, still in school and doesnt work and has 1 cc (I doubt she has "built" up enough credit to buy a house.

very strange sitauation feel like it doesn't all add up.

Re: Pls. help me settle a debate over debt & bankruptcy

My friends claimed bankruptcy 6 years ago....they purchased a home after 5 and 1/2 years , and a business this year....and got CC offers uip the wahzoooooo after about 3-4 years.

And rates were NOT bad at all.

Their rates in fact were SOOOO much better then what we got offered with semi-bad credit.


Another friend claimed bankruptcy 4 years ago and she just got a new car at an interest rate 10 POINTS below mine when I had my car....