Bankruptcy - Question for Landlords

desperaterenterNovember 23, 2009

A couple of months ago, I discovered that someone had stolen my identity and racked up thousands of dollars in credit card debt. Since the identity thief was a family member (meaning that as badly as she treated me, I can't see filing police reports and possibly watching her arrested or worse), and since I'm your typical college student with no assets to lose, I've been advised by an attorney that my best bet is to file bankruptcy, if for no other reason than that it'll be ten years before this is sorted out anyway.

Every apartment I've ever lived at required a credit check (funny how none of them care about a background check - personally, I'd feel safer renting to a bankrupt than a paroled murderer), but is it absolutely impossible to rent if you've filed? If they check my reference with my last landlord, they'll hear that I went two years without being so much as a day late. It's not that I don't understand their concern, but I do need a place to live when I graduate in May. What can I reasonably expect?

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camlan

Some landlords of smaller buildings don't run credit checks. They will want to meet with you and probably get your last landlord's contact info to check on you.

I know you didn't ask about this, but who exactly is advising you to file bankruptcy? Who is paying this lawyer? Does the lawyer have any connection with the relative who stole your info?

You do realize that filing bankruptcy affects what credit you can get, including a home mortgage? And that many employers are now running credit checks on new employees? Just the idea of it is, right now, affecting where you can live, as you try to figure out if anyone will rent to you.

If you haven't already filed the bankruptcy, I'd get a second opinion from a different lawyer. You may be doing this relative a huge favor at considerable cost to yourself. It's not just about the money today, it's about your financial future.

Honestly, if a relative committed a crime against me, I'd have no problem filing charges and seeing them go to jail. It would be all too easy for them to simply turn around and commit the same crime on another family member.

    Bookmark   November 23, 2009 at 9:26AM
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taku

Why in the world would you file bankruptcy (BK) when you were the victim of ID theft. Family member or not, I'd be filing a police report and immediately notify all three credit beauru's of the report. Notify all of the credit companies of the fraud:

Equifax: 1-800-525-6285; www.equifax.com; P.O. Box 740241, Atlanta, GA 30374-0241,

Experian: 1-888-EXPERIAN (397-3742); www.experian.com; P.O. Box 9532, Allen, TX 75013,

TransUnion: 1-800-680-7289; www.transunion.com; Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92834-6790).

Inform them these charges are NOT yours (you'll need the police report). You are not liable for a debt that you did not create. That's the law of the land.

Of course any attorney is going to steer you into filing BK, that's because that's how they make money off of you. They could care less about your situation, as you'll be long gone by the time they get your money and file you case with the BK judge. You realize by not filing the police report you ARE enabling and condoning criminal activity. Camlan is correct, I would definitely not file BK.

http://www.ftc.gov/bcp/edu/microsites/idtheft/

    Bookmark   November 23, 2009 at 10:10PM
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moonshadow

Oh desperate, you finally got away from the elephant people and were on your way to some peace, now this? I'm sorry to hear it. :/

is it absolutely impossible to rent if you've filed?

Not as far as I'm concerned.

I always check credit reports. It's not uncommon to encounter applicants with credit issues or bankruptcy in their history. In recent years I've rented to 3 different tenants who had a bankruptcy. All proved to be exemplary tenants. But I did pay close attention to what happened, and why. Some people it's a result of just not being responsible, e.g. racking up loads of credit ala recent years when credit was handed out like candy. But also bad things happen to good people every day, job loss, illness, etc. Bypassing someone who has had problems, but shows they are able and willing to pay can mean a good tenant passed up. The fact that you pay diligently is a huge bonus to you, but there is a lot bigger picture here than just the rent.

Just because someone who has filed can rent a place doesn't mean everything is rosy. It's not a magic eraser with no strings attached, there are strings. I hear about them a lot when discussing these things with applicants. Once someone has filed, and they are in a position to start rebuilding their credit score, there always seem to be more hurdles to overcome. Such as higher interest rates on mortgages or loans or credit accounts (once the time period has elapsed where someone is willing to offer credit again). Even things like higher deposits for services (cable tv, utilities or cell carrier contracts). That bankruptcy has to be explained at every turn and crossroad that involves finances, and there are penalties or premiums for it. Most every forward move of a financial nature is impacted. For a long time to come.

I'd encourage you to look into every other possible resolution before filing. I get that you're in a weird situation because it's family. But would really urge you to try to get a couple additional professional opinions. (Financial advisor at a bank, an accountant, maybe an attorney in general law practice.) If the attorney you already spoke to has an ad on the back of the local TV guide every week, then yes, filing is what they are going to suggest you do, because as mentioned, that's probably all they do, and advising you otherwise is lost income for them. Five years from now you might be in a position to buy a home and the filing will be the one hindrance stopping you, and making you wait years longer.

You're just getting started in life, you've worked hard to get where you are. Graduation will be here before you know it! It would be a shame to see your options so narrowed when so many possibilities will be on the horizon for you. It's kind of like having your wings clipped right when you're ready to spread them & soar.

Can you take a little time to check it out further?

    Bookmark   November 24, 2009 at 9:11AM
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jenc511

Please don't file BK over this. BK is bad news and will affect you for so many years. It's terribly disruptive. Not having much in the way of assets now doesn't mean you won't want them in two or five or ten years.

I won't say anything about how you should handle your relative who deceived you and threw your credit away, but it's very hard to get a number of jobs, buy a house, get a cell phone, or otherwise handle many financial transactions with a BK on your record.

Honestly, you say it's "thousands of dollars", and it might be cheaper just to pay off the debt than to file BK (even with late payments reported to a credit bureau). Think about it...this will affect any attempts you make to buy a car, buy a house, get a cell phone, get a job, etc. over the next decade. This is only assuming you feel the need to finance this person's terrible behavior. I don't know the circumstances, so I can't advise you about that, but I do know that BK is not a joke and not worth it to wipe out a few thousand dollars worth of debt. If you intend to pay cash for everything for the next decade, then it might not matter. My thinking is that your relative couldn't have racked up so much debt on a college student's credit that it's completely insurmountable. It could certainly be daunting, but still better than bankruptcy, if you can avoid it.

    Bookmark   November 24, 2009 at 11:21PM
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dilly_dally

#1. Fire that attorney. S/he is an idiot.

An attorney should be helping you file criminal charges against the culprit not helping the culprit get away with it and ruining your life for you.

#2. Contact the creditors and let them know this is not your debt and you are taking legal action against the culprit. Work with them. This means giving up any and all info that will help them recover their losses and help you also.

Had you contacted the creditors in a timely manner when you first became aware of the fraud THEY would be the ones to pursue the criminal - not you. You may or may not have waited too long by now with your state's limitations. How hard was it to pick up the phone or write a letter to say "This is not my debt." and then let them handle it from there?

    Bookmark   November 25, 2009 at 2:09PM
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moonshadow

desperaterenter said "Since the identity thief was a family member (meaning that as badly as she treated me, I can't see filing police reports and possibly watching her arrested or worse),

If we stop to think about it for a minute, we might find it easier said than done to turn in a family member. We don't even know who it is; mother, sister? There's no telling what led to the theft (an addiction, for instance), because desperate has opted to keep that private (which is understandable). My point is there could be a lot more going on here than we know about, and when it's family and some bigger problem is prompting the behavior, it's just not that easy to turn the person in.

    Bookmark   November 25, 2009 at 7:54PM
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