Ask Me Help Desk - Charge-offs vs. Bankruptcy

My husband and I are in a large amount of debt based on a business we started that didn't work out. We've been advised to file bankruptcy but we want to be responsible and pay our debts through settlements. However, our accounts will go into charge-off (probably around 15 accounts) before we'll have the money to do that. Would it be better for us to file bankruptcy and then just pay them back when we have it since I hear charge-offs are just or almost as bad for our credit?

No, you don't pay them back after you file bankruptcy, that would be treating one level of debtor different from another and cause the bankruptcy to be able to be challenged by another debtor who has not gotten paid.

And charge off does not mean anything except they are writingit off their taxes, it does not mean they will not keep trying to collect and maybe even sell the debt or perhaps still sue you and get a judgement.

But if you file a bankruptcy you do not go back and pay anyone.

Quote:

Originally Posted by reginasurvey

My husband and I are in a large amount of debt based on a business we started that didn't work out. We've been advised to file bankruptcy but we want to be responsible and pay our debts through settlements. However, our accounts will go into charge-off (probably around 15 accounts) before we'll have the money to do that. Would it be better for us to file bankruptcy and then just pay them back when we have it since I hear charge-offs are just or almost as bad for our credit?

I went into a settlement company and things went great for the first little while but now they are all comign after me wantign to sue me with the possibility of freezing my bank acount meaning I cannot pay for my car or feed my kids we owe a lot of money and they will charge them off but some sleazy collections agency or lawyer will but them for pennies on the dollar and they are still going to come after you so now I am going to visit a bankruptcy lawyer and probably file. My credit is already ruined so not like I can do much more damage My score was over 600 when I entered the progam (settlement) and they were like oh well it will afect your credit score some well now my score is in the very bad range I couldn't even get credit to buy a loaf of bread. It's a personal decesion but most lawyers will give a free consult so it can't hurt to go talk to one.