Which should one File?

Submitted by daxden on Fri, 09/14/2007 - 06:13
Forums

What's better- charge offs or bankruptcy

Neither are going to help you get a good rate on a loan or credit card.

"Charge off" is just a fancy word for bad debt; you still owe the money...and you can be sued for repayment. Judgments look pretty bad too.

Bankruptcy is a last resort measure...use it when you are in way over your head with no prospect of paying off your debts. It gives you a breathing room; a chance to start over, but it will be on your credit report for 7 years like a charge off (in a chapter 13), or 10 years (in a chapter 7).

I recommend speaking with a financial counselor to help you make the right decision. Whether you settle, consolidate, or file bankruptcy, in the end what matters is how you best make use of your resources--negative info on a credit report is not forever, and you can recover from all of them.

Fri, 09/14/2007 - 07:37 Permalink