Should i rebuild my credit or file BK?

Question

I just went to get a car and my beacon is 380. Most of it will drop off within a year due to the 7 yr rule. Should I try to reestablish and pay off debt or just claim BK? With all this old debt would my credit score even get up to 700+ if i pay everything?

Answer 1

your score will not go up to 700+.  Absolutely pay off the debt and do not file bankruptcy.

Answer 2

I would try to rebuild my credit worthiness first - BK would be the last option.

Pay off those with the highest interest rates first.

If your debts are overwhelming, contact a nonprofit credit-counseling organization to work out a debt-consolidation plan. A counselor will help you consolidate your debts and will contact your debtors on your behalf to reduce or eliminate finance charges. This can reduce your monthly payments by up to 40 percent.

Work with your credit counselor to repay all of your debts. Meanwhile, live a life that will help you re-establish good credit. Pay rent and utilities or mortgages promptly, keep the same residence and job, maintain savings and checking accounts, set a budget and stick to it.

Advise:

Filing for bankruptcy is always an option, although your credit history will reflect it for 7 to 10 years, making it very difficult for you to get a car or home loan in the future.

Every application you make for a credit card shows up on your credit report, and multiple applications can hurt your credit rating.

Answer 3

If your credit is already screwed, try to negotiate with the lenders, it will show the effort. Bankrupts is an easy way out,but not always the best option.

Answer 4

Bankruptcy will be on your credit report for 10 years, making it harder to get credit and increasing your interest rate if you can get credit.  You can probably rebuild your credit faster by starting to pay off your debt (although since you are bumping up against the reporting limit, making a payment re-starts the bell tolling).

Your best bet is to see c edit counselor who will look at your situation and be able to advise you much more thoroughly.