Addiction to Credit Pervasive

The United States has become a nation where everyone needs credit, everybody wants credit and everybody fears that, without credit, they will not be able to function.  I’ve had people come to see me and wondered, if they give up their house and file a Chapter 7 bankruptcy, will anybody let them rent?  Of course, as you know, people are able to rent after a bankruptcy. People are often able to purchase a house two years after a bankruptcy filing.

I tell my clients that, if they were not able to rent, you would see thousands of people walking up and down the streets without a place to live.  The truth is people do get houses after bankruptcy.  People do rent without a problem after bankruptcy.  People do get cars after bankruptcy and, believe it or not, people get credit cards after bankruptcy.

Credit After Bankruptcy

Since creditors know that you can’t file again for eight years after you file your first case, they inundate you with offers because they want you to get back on that credit train.  They want you to use the credit, pay the annual fee, pay the high interest rates and get involved with late fees and over the limit fees because that’s how they make money.

So, when someone comes to my office, I definitely have to tell them that there is life after bankruptcy and a good life after bankruptcy.  I know, after seeing clients for the last 20 years, that credit is what really is important to people.  People will struggle with $20,000.00, $40,000.00, $80,000.00 worth of debt and they will not opt for the bankruptcy because they’re worried about getting credit again.  If there was a place where they can contact prior clients who have gone through bankruptcy, they would be able to see that, not only do they get credit after bankruptcy, they get credit relatively quickly.

So Chapter 7 is the case that I recommend for someone who is struggling financially with unsecured debt and who does not have a lot in terms of property.