[kayve]

I had several credit cards a number of years ago that I couldn't pay. The balances are pretty high, nearly $20K just the original balances added up before collections agencies tacked on their extras. A number of years before this.. around 1985, I had a similar thing with much smaller balances. I know those disappeared with the "do nothing" method. I just decided to browse the web for answers about this and it is very irritating. There is a bunch of conflicting information.

I am in a somewhat unique situation. I was diagnosed with schizophrenia when I was around 22 (I am 43 now), and I have been receiving the ~$800 a month SSI (Social Security Insurance I guess that means) since I was about 25. I've had a few jobs here and there, but I am in a situation where my rent is covered. I am working on my second Master's degree in computer science now, and I will graduate soon.

I have ignored all my bad debts for a long time, but a few years ago (maybe as many as 4 at this point, or 5? I am not even sure) I was served a summons, I didn't appear in court, and since then I get letters from lawyers with that legal format type documents talking about my debts instead of just the collection agencies. I also have some student loans, and those have finally went to collection after all these years maybe in the past 3 years or so.

I am assuming what has happened to me is that I have a "judgement" against me. I have found conflicting advice online, so I hope I can verify information somehow. One advice said that judgements can last for 20+ years and another said they are gone in 7 years. The site that said judgements leave after 7 years said that bankruptcy lasts for 10 years (all this on the Equifax etc.). This is in conflict with what my stepdad in Arizona says, namely that bankruptcy disappears after 7 years. He keeps telling me I should have filed bankruptcy years ago.

I have a friend who helps me financially, and she would help me with the bankruptcy filing fees which I have been told by free legal help at the Oakland public libraries (I live in San Francisco, California) that there are paralegals that charge $150 for the filing of my documents, and that would be in addition to the $299 fee to file bankruptcy. I am a loss right now what to do, to file or not to file?

I hope to start a job search soon, I am done being a perpetual student. My stepdad says my 500 something FICO is so bad that if employers are looking for that information, they won't hire me anyway. I have two books on bankruptcy that agree, i.e. that bankruptcy looks like a responsible action. In contrast, I have another friend who says that bankruptcy immediately sends my FICO to the 300 range, but when I told this to my stepdad he said this is true, but again, this disappears after 7 years (maybe he is talking Arizona law--he worked for American Express for 25 years in Phoenix, and told me he programmed the code to calculate these things, but this could all be irrelevant to me in California), and if I start working on my credit 6 years after bankruptcy, by getting a secured credit card and handling it correctly, I will maximize my FICO, I guess sending it to the 600 range, according to him.

I was working as a substitute a year or two ago, and the judgements made it to payroll and I got garnished. The most expensive things I own are two music amps about $1000 each and a telecaster guitar that I bought in I guess 1990 $400. It might have appreciated in value, but that can't be true for the amps. My understanding of the California Chapter 7 bankruptcy laws from my Nolo press book is that it is the only state with a dual homestead. One homestead has a high retainer (I don't know the proper term--if you have equity in real property you own, you get to keep it--right, this is almost the whole point of bankruptcy) maybe it was $150K? That is for folks who own expensive (compared to any other state) homes. Unlike any other state, California has an option B (forget the correct term) for homestead which has a much smaller value--$18K plus change--which I guess is for folks like me--maybe they live in campers that might be worth around $18K, and that is their homestead. My reading of the law surprisingly seems to say that any property can be included under this homestead, meaning that I can keep my guitar and amps in my understanding.

Basically, I guess I am what you call a "no asset" case, at least for now. I had an idea that I would file for bankruptcy this summer when I am out of school because I would have more time, but now I am confused, I feel that maybe the "do nothing" would end up working for me in just a few years when the 7 year clock runs out on the judgement, assuming this is how it operates. On the other hand, I moved from the Oakland Unified School District to the San Francisco Unified School district and I noted the garnishers sent me a notification that they were following me. I suspect that they will follow me if I do manage to get a job after graduation, which seems possibly promising (this question I will discuss further below) because the economy is supposed to improve soon, but then I will be garnished, but maybe I can pay things off or something one of those half price deals that I have seen discussion about, and have received letters about numerous debts with this deals plainly spelled out for my personal situation.

I really want to find out how all of this is going to affect my job search. I had one interview where they straight up told me that they were going to check my credit, and I knew right then I wasn't going to get that job. I need to know whether a bankruptcy filing early this summer will hurt or help my job search, and whether it will just start a new clock ticking which might be 7 or 10 years from the conflicting information I have seen. I have a handful of years under my belt with the judgement, as I have noted, so maybe this would be significant.

[JudyKayTee]

I'm sorry but this is really too long to read and digest. What are your specific questions - will your credit report affect your job search, should you file in bankruptcy?

[kayve]

Yes

[kayve]

If you "can't digest" the pertinent details, I don't see how you can give accurate advice. To elaborate on my last post, yes. You can boil it down to the two questions you point out. That is what I want to know. Thank you in advance.

[ScottGem]

If you "can't digest" the pertinent details, I don't see how you can give accurate advice. To elaborate on my last post, yes. You can boil it down to the two questions you point out. That is what I want to know. Thank you in advance.

I'm sorry, but your post was not full of pertinent details. Your post could be summed up this way:

I had over $20K in debt that went to collections. I ignored the debts and legal action in reference to them. I will be completing a degree soon and will to be able to get a job (I've been living primarily on SSI). I'm concerned about how long these judgments last, and how it would affect my job search if I file for bankruptcy.

Those are the pertinent details, everything else is extraneous. You owe Judy an apology.

Now to answer your questions. Depending on the state a judgement will last for 7-10 years and be renewable for at least one term maybe more. So a judgement can easily remain in effect for 14 years. A bankruptcy will stay on your credit report for 7 years, but it does not expire. Yes you rebuild your credit score with a bankruptcy on your record, even after a few years. These are separate issues. ANY negative entry on a credit report is suppose to time off the credit reports after 7 years. But that doesn't mean the debt time offs, especially if a judgement exists. You are mixing up reporting on credit with the legal obligations to pay them. Those older debts are still owed by you. It may just be that it was deemed to costly to continue collection efforts.

And yes, having a bankruptcy can affect your job search. It depends on the type of job. If the employer does a credit search (and many do) it will show up. So, I would discuss it up front and not try to hide it.

[kayve]

Which is worse for my job search, bankruptcy or bad credit?

[ScottGem]

About 6 of one, half a dozen of another. Bankruptcy may have an edge because it shows an attempt to meet your obligations where bad credit shows dodging them.

And where is the apology?