My Bankruptcy Story

A little over fifteen years ago I declared bankruptcy. This was mainly due to compulsive gambling that I financed with credit card advances. My total debt was only about $20,000. When I think about that amount now I know I could have paid it off eventually but at the time it seemed like an insurmountable total. One of the main reasons that it seemed insurmountable is the my credit card companies kept hitting me with late fees,over the limit fees and punitive interest rates so even though I was making monthly payments my debt just kept getting larger. Getting into debt was one hundred percent my fault but I feel the credit card companies should have at least tried to work with me. With the credit card companies offering no flexibility on the repayment terms the situation seemed hopeless. I gave up and declared bankruptcy.

The bankruptcy law has changed since I declared bankruptcy, someone filing today would have a different experience. The lawyer fees and court fees together were about $500. I’m sure it would cost more now but it was a lot to me at the time and it was a struggle to come up with the amount. The bankruptcy hearing itself was pretty simple. None of my creditors showed up. The judge asked me if I had any assets. I replied that I did not and that was pretty much the extent of it.

The aftermath wasn’t too bad either. I’m sure my credit was very poor after that but I wasn’t applying for any loans so it didn’t really matter. I was able to rent an apartment while the bankruptcy was pending. The apartment management didn’t really care about the bankruptcy. I was told as long as my rental history was fine then there wouldn’t be a problem. My rental history was perfect because I always considered my rent payments more important than credit card payments. Since the bankruptcy was quite a while ago it no longer has any effect on my credit and I have above average credit.

All in all my bankruptcy experience wasn’t that bad. It was probably too easy but since the law has changed I don’t think that is true now. I wouldn’t do it again in the same circumstances though.

10 Responses to “My Bankruptcy Story”

  1. Khaleef @ Fat Guy, Skinny Wallet May 4, 2012 at 9:59 am #

    Thanks for sharing your experience. I think it’s great that even after having your slate wiped clean, you say that you wouldn’t do it over. I think fighting your way out of debt can teach you a lot and can also be a huge inspiration to others.

  2. Thomas May 2, 2012 at 10:34 am #

    Thanks for sharing your story. It goes to show that we all have a second chance if we want it. You clearly learned from this event. By the way, given your youthful photo I guess you were quite young 15 years ago :-) … we all make mistakes in our youth!

    • Andy Hough May 3, 2012 at 4:35 pm #

      I was old enough to know better but too young to care.

  3. Jai Catalano April 25, 2012 at 5:17 am #

    That was really brave of you to share. It’s not bad it’s not good it is. We look at things as being good and bad but the reality is that it has nothing to do with it. I am not saying not to have accountability for your actions. I am just saying that what you did was take a specific route to get to the next level. Is it good or bad? In my opinion no. It’s just a path that you seemed to have learned from greatly.

  4. Eric J. Nisall - DollarVersity April 23, 2012 at 1:49 pm #

    I would imagine that the new rules would make it much more difficult to have debt related to anything other than medical issues or loss of income discharged without entering into a strict program or something similar. I considered filing when I lost my job a few years ago and started building high balances while trying to keep all of my responsibilities current. Then when I started hearing about strategic defaults on homes that were underwater, the thought crossed my mind again. Of course, I never did anything about it but now, I just refinanced my condo under HARP 2.0 and paid down almost 75% of the debt so I’m glad I didn’t file, since I would still have that strike against me for another few years instead of being almost home free now.

    • Andy Hough April 23, 2012 at 4:33 pm #

      If I knew then what I know now I wouldn’t have filed. I’m glad things have worked out for you. Declaring bankruptcy is something you don’t want to do if you have other options.

      • Eric J. Nisall - DollarVersity April 24, 2012 at 8:03 am #

        It was tough. probably could have saved enough to put more than 20% on a new place when I emerged, but I just didn’t want to admit to myself that I failed.

        At least you can look back now and say that you learned something. That’s the ultimate accomplishment.

  5. Robert @ The College Investor April 22, 2012 at 2:04 pm #

    Thanks for sharing your story. I’m glad that you were able to get through it in a positive way, and are better now for it.

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