Overall Timeline

As near as I can tell, filing Chapter 7 is going to be a black mark on my credit history for 10 years.  My future ex-spouse does not see this as an issue, but she has never worried about interest rates, deposits on utilities, etc.  And the road for that 10+ years is just beginning….

We have our 341 hearing on Monday June 8th.  This is the meeting where the bankruptcy trustee & our creditors get to hear our sob story.  We’ve been told that after this process, it will take 60 days to discharge the debts, which is August 8th.  For some reason, the house does not fall under the bankruptcy hearing per se.  It helped in the means test, but it is not included in the filing.  Which means due to the amount of child support I’m facing, I can’t afford the mortgage.  In addition, my soon to be ex-spouse won’t be able to afford it either.  So we are walking away from the house.

We just got notice from the mortgage company that we are 3 months in arrears.  Not sure when the foreclosure process will start.  I will leave the house before it the bank takes it away.  The wife will probably stay until she has to leave since she has no job (and has no desire to find a job) and does not want to start paying rent somewhere.

Anyway, after the debts are discharged, then the divorce can be finalized.  I hope all this will be resolved by end of August or early September.

Once all of this is done, then I can truly start over.  I am reaffirming the debt on my car in hopes that this will help showing a positive impact on my credit history.  In addition to keeping the car loan, I have opened an account at a credit union. Supposedly, I will be able to get a load through the credit union easier than a mega bank, whether it’s for for a car, a house, or short term loans.  The stratey that I will start with is to take out small loans & repay them quickly.  This will hopefully bump up my credit score faster.

I plan to start tracking my FICO score at http://www.myfico.com & will plot my progress.  Very curious to see how low my score goes.  Currently it’s at 680 as of a couple months ago.  It’s about time for the quarterly update.  I am in the process of researching different ways to boost my credit score.  One of my goals is to be able to get back into a house within 2-3 years without having to pay a a super high interest rate.

But the fact that it will take 10 years to get the bankruptcy off of my record.  Not only will this impact any loans & credit card I may get, but I have also found out that with employers doing more background checks these days, Any change in a job at this point has become infinitely more difficult.  2 out of 3 former colleagues have told me that their current companies would exclude me from their hiring pool.  The other friend said their company would hire  someone with a Chapter 7 on their permanent record if it was explained up front.

What a wild strange ride it will be….