Our Zeitgeist, Credit Building, Credit Unions, Facebook

     Some of the thousands of clients whom I have helped through bankruptcy have come back to me and told me that they have obtained very good credit after only 2.5 to 3 years. Take that for what it is worth but I am of the opinion that if you do things right that that time frame is about right. Yes, bankruptcy stays on your credit history for ten years, but I think that if done right, reestablishing of a good credit score can be achieved a whole lot sooner than that. 
     You cannot eat your credit score. However, it may keep you from eating. Some states have made it illegal to read credit histories of employees applying for jobs but apparently some states have not. I do not think that Colorado has yet joined the list of states caring about it. Call me and correct me if  am wrong. 719-632-9991.
     I have heard that as to a bad debt, that a denotation of that problem stays on your credit record for 7 years AFTER you pay it off. This is an old recollection and it may be totally wrong but it highlights the fact that just paying off a debt may not be an instant solution to a credit problem. 
     Several bankruptcy attorneys in Colorado are very impressed by a mortgage expert by the name of James Spray, at Jamesspray.com . He happens to be a very nice guy and he attempts on his website to give credit reestablishing advice among other things and it might be a fruitful read for anyone trying to do that. One of the things he talks about are SMALL credit unions and how sometimes they can be a good place to start with your reestablishing efforts. The fact is that credit unions are set up and run differently than banks. It seems to me that large banks like Wells Fargo care more about the bigger accounts and less about the smaller accounts. (I guess that is a DUH, but I am trying to hold back on venting my spleen on my distrust of large banks.) That makes good business sense to the banks but not much sense to a smaller business or an individual. The smaller credit unions can be more personalized. They might give you a break more often or maybe just will provide more options. Check them out. I do worry about cross collateralization, which is a favorite credit union technique, so ask me about  that if you retain us for your bankruptcy and you have a credit union loan or two.
 
     My feeling has always been that people want to build credit to get (1) a home (2) a car and (3) a credit card. I have always encouraged people to certainly think twice before getting (2) and (3) as there are other ways to skin those cats. (2) can be solved by breaking your addiction to shiny metal, breaking your addiction to paying twice what the car is worth to a car dealer for your shiny metal, and breaking your addiction to GIVING your old car to a dealer in what is called a TRADE IN but is usually actually a gift to the dealer. (3) is solved by getting a debit card so that you can pay at the pump and everywhere else easily with a debit card but you are not out there in the mall with a CREDIT CARD  taking out 20% loans every time you want to buy a dress or auto parts. I am still working on good solutions to (1) but I can tell you that cash talks. Cash can many times solve a credit problem if you have enough of it. CASH might encourage the home seller to take on the financing risk themselves or may be able to open up other avenues. Not long ago the old saw about buying a home would allow you to build equity in a home was just not true as home values plummeted, but now home values are going back up, especially in the Denver area and now Colorado Springs and soon Pueblo I am thinking. I am no Nostradamus, but it sure looks like homes are going to again be a viable option. Jamesspray.com again may have some ideas. 
     The scary thing is that credit scores are being used for all sorts of things now. If your insurance rates, job applications, rental applications, and what the hell else can be affected then we all need to study our credit scores. It is really pretty frightening that your scores can be used that way but right or wrong we need to all pay attention . By the way, dwelling on what is right or wrong or fair or unfair is just a waste of time. While someone is crying over spilt milk someone else is jumping ahead of you to get that last job or that last bean on the plate. There are no no regrets and no tears in bankruptcy and sometimes no fairness either. Talk to every one of your creditors that we list on your bankruptcy, and we list them all, and ask them about fairness. Not one of them will say that it is fair. What is true is that bankruptcy is a way to even the playing field. It is a way to get back. If you had had a trust fund you would not have had to gamble with that new business. But you did not. You had spunk, initiative, and ambition and wanted more out of life. It may not have worked this time and you may need a way to get back to trying something again and maybe bankruptcy is part of you plan.  But no regrets. 
     I joke with the people I work with that I always get from their high school principals their “PERMANENT RECORDS”. Remember when you were in school and they scared you by telling you that any screw up  would be placed in your permanent records? What the hell was that and where did they go? I tell my employees that schools give them to employers if they want them so that we have ALL the information on our coworker/employees. I tell one coworker that his permanent record is frightening indeed. I am sure it would be frankly. Ha. Just as those records, if they exist now or ever did except as a way to scare the hell out of students, would have absolutely no value in determining what kind of coworker a person would become, your credit record has very little to do with how well you drive. BUT it does give a good excuse for an insurance company to, with a wink and a nod, raise your rates. And if they ALL do it, on their own and without regard to any collusion or price fixing of course, then you end up having no other option except spending a bigger chunk of your income on insurance. And, of course, insurance is REQUIRED by law. Insurance companies have to make their shareholders happy. They do so by finding any way possible to shear their flock of sheep as close to the bone as possible. If they can use your credit report to jack up your rates to improve their profits they will do so, even if it has the tiniest bit of affect on your driving. It would make more sense to use your MEDICAL records to determine how much they could jack up your car insurance rates. Believe me they would too if HIPAA laws were not in effect. Those laws specifically make it difficult to access private medical records or, believe me, your medical records would be used against you every time a profit could be realized in any business with shareholders needing profits. And of course they all need PROFITS because THAT IS WHAT THEY DO.  I have heard along the years that if you are not shopping your insurance rates every 3 years that you are no longer paying competitive rates. Check them and check them often. The only way to keep a rabid wolf from hurting you is to keep it locked up and to watch it all the time. A wolf is beautiful and you might feel sorry for it having  rabies (or for an insurance company that must make ravenous profits to survive) but you certainly do not want to trust it. 
 
     Our zeitgeist, the spirit of our times, has to do with expansive new freedoms, exponential growth of information and more and more ways to pry into your private life. If you are a wild and crazy facebook type of guy, realize that employers DO look at that stuff. Just as your high school permanent record has no value for anything, neither does that picture of you passed out with a goofy look on your face after downing that pitcher of beer. Like the new cannabis freedoms? Your potential employer will love that video of you smoking a huge joint. Not potential employer actually as you are NOT getting the job. 
     I digress. To bring this back a little, your credit scores have to be dealt with as they are rightly or wrongly part of the zeitgeist. Your facebook entries, your credit scores, and all other information about you all needs to be considered and if you can do something to improve them you should. I have clients who are referred to me for bankruptcy by bank employees and lenders who know that they cannot do business with that person unless and until they deal with their credit. Sometimes this set of laws allows you to get back sooner than later. Life is good.

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