The Law Offices of Joy Lee Barnhart are located at 15 South Grady Way, Suite 535, Renton, Washington 98055. Our telephone number is (425)255-5535. Fax number (425)255-5609. E-mail us at joylee@joybarnhart.com.
Ms. Barnhart has been engaged in the practice of law since 1982. Her primary areas of practice include bankruptcy, both consumer and small business, and Estate Planning, Wills, Trusts, Probate and Guardianships.
Congress is currently in the process of altering the Bankruptcy Code. This is being billed as a "reform" of the process, but the bill as currently proposed is actually highly anti-consumer. Not only will it make it more difficult for those with moderate incomes to file for protection of Chapter 7 bankruptcy, but it will reduce the protections currently granted to those who are owed child support or alimony by individuals going bankrupt, by increasing the obligations owed to credit card lenders. Demands for greater accountability on the part of the credit card industry have been effectively removed from the bill.
This is not the sort of "reform" needed of the Bankruptcy Code.
These are not, by the way, the sour grapes of a bankruptcy practitioner whose ox is being gored by the changes to the Code. Based on the current version of the bill it will, it anything, increase my business forcing people who under the current system are filing without the assistance of an attorney to retain an attorney because of the increased complexity.
Filing for bankruptcy protection is not a step to be taken lightly. It will have a serious impact upon your life. Credit bureaus will report the fact of the filing for up to ten years after the date of the discharge. There can be repercussions in employment and housing.
Having said that, as a practical matter, an individual who has steady employment and does not have any collections reported against him post-discharge can usually begin to reestablish credit three years after emerging from a bankruptcy. This time frame can vary depending on individual circumstances and the lending market.
There are lenders who will lend to people almost immediately after the bankruptcy is discharged. Bear in mind that these lenders are dealing with what is regarded as a 'high risk' market. They charge interest rates commensurate with the perceived risk -- generally more than 20%.
Oddly enough home mortgage lenders tend to be the most likely to be willing to lend to someone who has a bankruptcy in their history. There is a very large market of home mortgage lenders who if you would otherwise meet their qualifications, will lend money for the purchase or refinancing of a residence three years or less after the bankruptcy is discharged. In fact I once attended a seminar in which the representative of the mortgage industry bluntly stated that his underwriters would rather lend to someone who had been through bankruptcy, than someone who had a history of late pays or collections.