No. of Recommendations: 2
1) What other options do I have to get out of debt that will not have as bad consequences as declaring chapter 7?
I highly suggest reading Jerrold Mundis book - How to get out of debt, stay out of debt and live prosperously. He goes into detail on how you can take control of the creditors and pay them off. Yes you will have some black marks on your credit, but nothing as seriously as a bankrupcty.

2) What effect will this have on future employment?
Depending upon the field you are in, it may have zero affect on your future employment. Investigate your field - do they normally do background checks that include credit report checks? Do they base employment on your debt/income ratio and on your credit worthiness?

3) What effect will this have on future places I want to live (apartments, getting a loan to buy a house)?
For the first 2 years out of bankrupcty it can be a problem. If you have excellent rental references many landlords will still rent to you. They may require double the deposit though. Buying a house is another story. The day after a bankrupcty is discharged you can qualify for a mortgage loan. The catch is that you'll have to have a minimum of 10-20% down (depends on the loan) and it'll be at the highest rate, for example today it would be 11.75%.

4) What would be different on my credit report if I did a settlement, consolidation, or payment plan?
If you do a consolidation loan (not a Chapter 13) the only thing that will be different is that you will show your other loans paid off and a new loan on your credit report. The danger with that is you will have nice empty credit cards to simply charge up again. Not a wise choice. Settlement will simply show account "paid or settled" on the credit report. The catch with this is that many credit card companies won't even consider settling until the debt is at or in charge off. At that point you have to settle with the collection agency and have the 6-12 months of dings on your report. Payment plan depends upon if it's your payment plan and you are forcing it on the creditor (read the book above) or the creditor's payment plan. If it's yours, you'll have late pays, if it's the creditors, before you agree to anything make sure you have in writing that they will not report the reduced payments as late pays.

5) I have an IRA account? Can they seize those funds?
This depends entirely on the state you are living in, the amount of the funds and the amount of debt you have to pay.

6) What will my total cost be (including court and legal fees - I live in California)?
Chapter 7 will run you $1000 or so, Chapter 13 is double that amount. These are estimates only.

7) Qhat are the worst repercussions of chapter 7 bankruptcy? Will I never be able to buy a home?
You can buy a house the day after discharge. But, it will be high interest and high down payment. The BK will remain on your report for 10 years and it will affect things like utilities (they require deposits), getting cell phones, future credit, etc. The older it is, the less it affects.

8) Will it effect my ability to go to graduate school?
No. You can still get into the school (unless it's a specialized school that actually checks credit reports) and you can still get student loans as long as you are not currently in default on previous student loans. Which, by the way, you will not be able to purge in a bankruptcy unless you have been consistently in repayment for 7 years (doesn't matter if you've paid or not, just have to be in repayment for 7 consecutive years with no deferrment or forebearance).

9) Some say this lasts 7-10 years but others say your entire life. Which is it?
Both. Although it remains on your credit report for 10 years, there are records that it remains on for life. It really depends upon your career, industry, etc. whether it will come back to haunt you later.

10) Has bush made things harder for chapter 7? Has he changed it?
Bush hasn't done anything, it's Congress and what they've been doing is the following: forcing people to choose Chapter. 13 over a Chapter 7 if there is anyway the person can make monthly payments in any form to pay off any amount of the debt. The only thing that does to you is that you have to file with a detailed budget and the courts decide (based on your reasonable living expense budget) how much you can afford to pay monthly for 3-5 years towards your debt.

11) If I rent and own an older car would they still try to seize any of my possessions or garnish my wages?
I'm not sure if you are asking this question within the context of BK or not. I'll answer both - first within BK - you are allowed personal possessions of up to a certain amount. It all depends upon the value of the care. Usually you are safe under $2500 car value. Outside of BK - they can attempt to garnish your wages but, please read the above book, there are ways you can prevent that if you are seriously showing good faith on making the payments you are forcing on the creditors. It is almost guaranteed they won't seize your vehicle if it's valued under $2500.

Hope these answers help.

C.
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