Starting Anew
So we’re finishing up with video 5 in our series on Intro to Chapter 7. We talked about what is Chapter 7, it’s a deal, give up your debt in exchange for any property that isn’t protected, hopefully not much or none. Then we talked about who qualifies, we talked about the means test cap. Depending on your household size, there’s an absolute cap. If you’re under it, you’re gold, you’re in, and you can do a 7. If you’re above it, you’ve got to have dollar-for-dollar documentable expenses that bring you back down under that, and then you can still do it.
In addition, you can only do Chapter 7 once every eight years, and it’s from the date of filing. So if it’s not been 8 years since the date that you filed your last Chapter 7, you need to wait until that date passes to do another one.
In the next video, we talked about how does it work? 90 days, start to finish, 30 days in, creditor meeting, couple of things you need to do after that. 60 more days, your case is discharged. And we talked about what you do after a discharge. Well, don’t put yourself in the same position, and don’t jump into debt. Can’t do this again for 8 years, so you’re not going to get out of it again, and a lot of places will tell you, that reputable sources have said, if you get one credit card and run it consistently at a 30% balance, for example, if you got a $10,000 credit card, you run it at $3,300, never above, never below, or if a $1,000 dollar credit card’s probably really more realistic, run it at $333, no more, no less, pay it off every month, that’s the sweet spot for credit reporting.
So that may be the quickest way to build up your credit. The main thing is don’t get yourself where you were. Start living with financial freedom, which is the whole goal of this series, the whole goal of my career, and what I want for you.
Okay, and this last video, we’re just going to wrap it up. I just did an overview of everything we learned in the first four videos. Then the last thing I’m going to say is how do you take this fresh start from a spiritual, and mental perspective and turn it into a new way of life? So we just talked about some of the practicalities. If you do any debt, only do it strategically. If you have an opportunity to buy a home, that’s one thing. If you’re having one credit card that you’re only using for purposes of rebuilding your credit, that’s one thing.
If you get into those bad habits again, using a credit card balance as if it’s savings, as if it’s cash that you have, you’re probably headed back to the dark side if you will. The idea here is to identify what caused you to spend and what caused you to live in debt, and address that, whether that’s through your faith or self-help group. But identify it and start living with true financial freedom, which is where I want to see every one of you.
For more information, you can reach out to me, an OKC chapter 7 lawyer, at oklahomacitybankruptcyattorney.pro.