Have you ever had to comeback from a large financial setback?

Gworm
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3/24/2022 8:23am
A down vote for this?????
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ML512
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3/24/2022 9:08am
Credit related question...

So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up around 100k in debt.

I've knocked out around 35k-ish already...so about 65k to go.

I'm really just down to my vehicle (used van, payment is pretty small) and a couple personal belongings, after selling anything I had of value.

I can probably knock out the remainder of my debt in 12-15 months depending on a few things. Thankfully I have dirtbikes through work to keep me sane since I literally can't do anything else because I'm basically broke within 30 mins of getting my pay check. From a credit stand point, do I continue down the route of just paying everything off since I can be out in just over a year...

BK route, how long does it take to recover on the credit side if you do everything "right"?

I know there's a lot of variables...just curious on a rough answer if anyone can pass on any insight.
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Boxvan446
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Burlington, WI US
3/24/2022 9:45am
If you are 12-15 months away from paying it off I would go that route. Although bankruptcy is an option, the 4-5 year recovery isn't worth it (from bankruptcy). If you were talking long term, 5-10 years to get paid off that would be a whole different conversation.
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LoudLove
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3/24/2022 10:23am
Boxvan446 wrote:
If you are 12-15 months away from paying it off I would go that route. Although bankruptcy is an option, the 4-5 year recovery isn't worth...
If you are 12-15 months away from paying it off I would go that route. Although bankruptcy is an option, the 4-5 year recovery isn't worth it (from bankruptcy). If you were talking long term, 5-10 years to get paid off that would be a whole different conversation.
Agreed. If you’re estimating <1.5 years to pay off $65K, then you’re not close to BK. Your creditors may have payment options that lessen the monthly requirements as well. Most companies would prefer to extend terms than deal with BK litigation.

And please, be careful on the bikes. They are a great way to channel your frustrations, but one miscue can ruin your financial recovery plans. If you need additional incentive, maybe sell your bikes, then reward yourself with a shiny new one once your debts have been cleared! Besides, your buddies can always give you a loaner.
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The Shop

LungButter
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3/24/2022 10:27am
LoudLove wrote:
Agreed. If you’re estimating <1.5 years to pay off $65K, then you’re not close to BK. Your creditors may have payment options that lessen the monthly...
Agreed. If you’re estimating <1.5 years to pay off $65K, then you’re not close to BK. Your creditors may have payment options that lessen the monthly requirements as well. Most companies would prefer to extend terms than deal with BK litigation.

And please, be careful on the bikes. They are a great way to channel your frustrations, but one miscue can ruin your financial recovery plans. If you need additional incentive, maybe sell your bikes, then reward yourself with a shiny new one once your debts have been cleared! Besides, your buddies can always give you a loaner.
ML runs this place. He rides bike for his job that are provided as part of his job.
G-man
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3/24/2022 10:30am
Gworm wrote:
A down vote for this?????
Yep G,
I have a Stalker where I could say "the sky is BLUE" and get a downvote. Laughing
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plowboy
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3/24/2022 10:53am
1.5 years doesn't sound like a long time unless you are starving that entire time. If the money you are using to pay down the debt would mean the difference between having food, lodging, utilities and gas money...then please...consult a BK attorney. If you get free of that debt and have an income...the recovery will be faster than you might imagine.

After my business failure and BK...I never possessed another cc. Pay cash for everything. A few years ago I did a refi on my mortgage from 7 to 3% interest rate. My credit union loan officer called me in..."You have NO credit score...not bad...NONE". Apparently, this is un-american. But, they looked at my income to debt ratio and jumped all over it. Bottom line...if you have a decent income and you don't feel the need to finance stuff you don't really need...you can get by just fine.
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SLAPAHO
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3/24/2022 11:38am
ML512 wrote:
Credit related question... So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up...
Credit related question...

So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up around 100k in debt.

I've knocked out around 35k-ish already...so about 65k to go.

I'm really just down to my vehicle (used van, payment is pretty small) and a couple personal belongings, after selling anything I had of value.

I can probably knock out the remainder of my debt in 12-15 months depending on a few things. Thankfully I have dirtbikes through work to keep me sane since I literally can't do anything else because I'm basically broke within 30 mins of getting my pay check. From a credit stand point, do I continue down the route of just paying everything off since I can be out in just over a year...

BK route, how long does it take to recover on the credit side if you do everything "right"?

I know there's a lot of variables...just curious on a rough answer if anyone can pass on any insight.
If your credit is already torched, paying the debt off is not going to help it. It will still be torched. See a BK attorney and file Chapter 7. You can start rebuilding your credit the same day the BK is discharged. It will be on your credit bureau for 10 years... but you can rebuild pretty quick. The BK laws are there for a reason.
And don't ever start a race team ever again.
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Chance1216
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3/24/2022 11:39am
Gworm wrote:
A down vote for this?????
G-man wrote:
Yep G,
I have a Stalker where I could say "the sky is BLUE" and get a downvote. Laughing
It’s Orange and, pink at first light and, sunset. Who you trying to fool ? 😉
1
3/24/2022 11:48am
If you’re paying is your credit actually in the shitter? If you got a sustainable plan to pay it of in 1.5 years…we’ll lemme tell ya 1.5 years goes by quiiick.
2
ML512
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3/24/2022 12:09pm
If you’re paying is your credit actually in the shitter? If you got a sustainable plan to pay it of in 1.5 years…we’ll lemme tell ya...
If you’re paying is your credit actually in the shitter? If you got a sustainable plan to pay it of in 1.5 years…we’ll lemme tell ya 1.5 years goes by quiiick.
Ohh my credit is in the shitter. I had a period where I couldn't pay. I had to get out of my lease, was living in the semi most of the time at the races (we could get guy's hotels at the races but I was too tight to get one for myself) and I started moving back into my parent's place the days I was home from the races. FUN TIMES. Laughing
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ML512
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3/24/2022 12:11pm
Boxvan446 wrote:
If you are 12-15 months away from paying it off I would go that route. Although bankruptcy is an option, the 4-5 year recovery isn't worth...
If you are 12-15 months away from paying it off I would go that route. Although bankruptcy is an option, the 4-5 year recovery isn't worth it (from bankruptcy). If you were talking long term, 5-10 years to get paid off that would be a whole different conversation.
LoudLove wrote:
Agreed. If you’re estimating <1.5 years to pay off $65K, then you’re not close to BK. Your creditors may have payment options that lessen the monthly...
Agreed. If you’re estimating <1.5 years to pay off $65K, then you’re not close to BK. Your creditors may have payment options that lessen the monthly requirements as well. Most companies would prefer to extend terms than deal with BK litigation.

And please, be careful on the bikes. They are a great way to channel your frustrations, but one miscue can ruin your financial recovery plans. If you need additional incentive, maybe sell your bikes, then reward yourself with a shiny new one once your debts have been cleared! Besides, your buddies can always give you a loaner.
As someone else in the thread mentioned, I run this place. Part of my job is test riding and all those bikes are loaners from OEMs. I don't own a bike, pay for gear, track fees, or anything...

If I get hurt testing, then I just do computer work and more editorial until I ride again. No big deal.
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G-man
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Mesa, AZ US
3/24/2022 12:17pm
So you have good medical insurance then?

If your credit is crap already, filing BK makes the most sense to me if your 65K in the hole.
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OldPro277
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Avonmore, PA US
3/24/2022 12:28pm
ML-- Ive been in the auto biz for 38+years and specialize in the finance end of things-- As Georgie asked above, if you've been paying your creditors,maybe your credit score isn't as bad as you think. And if you have a plan and can actually pay that 65k back in 18 mos, that's probably your best avenue. However, if you decide to do the BK route ,keep in mind there are different Chapters in a bankruptcy. A Chapter 7 is a complete "wipe the slate clean" start over and you pay your creditors nothing. Just make sure you have any assets protected so the bankruptcy court can't sell shit off. A Chapter 13 is a "payback" program, where the court appointed Trustee will make deals with your creditors on how much they will accept toward what's owed to them. Once its all decided, you will make a direct monthly payment to the Trustee and they will disperse the funds appropriately until the bankruptcy is "discharged" usually its 3-5 years. However, Bankruptcies stay on your credit report up to 10 years.

Is a 7 or 13 better for you ? That would a better question for your attorney.
Is a 7 or 13 better for any future creditor to see on your credit report?? It used to be that new creditors looked more favorably upon a 13 than a 7 (for obvious reasons) however in the past 5 years or so, my lenders don't seem to give a shit one way or another. I can get a customer an auto loan 30 days after a Discharged 13 or 7 without too much of an issue. A bankruptcy these days certainly isn't the death sentence it was in the past.

Now --- after all of that is pertaining to Pennsylvania state law--- California may be completely different, although most States follow the Fed guidelines.
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Tracktor
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3/24/2022 3:09pm Edited Date/Time 3/24/2022 3:10pm
If you’re paying is your credit actually in the shitter? If you got a sustainable plan to pay it of in 1.5 years…we’ll lemme tell ya...
If you’re paying is your credit actually in the shitter? If you got a sustainable plan to pay it of in 1.5 years…we’ll lemme tell ya 1.5 years goes by quiiick.
ML512 wrote:
Ohh my credit is in the shitter. I had a period where I couldn't pay. I had to get out of my lease, was living in...
Ohh my credit is in the shitter. I had a period where I couldn't pay. I had to get out of my lease, was living in the semi most of the time at the races (we could get guy's hotels at the races but I was too tight to get one for myself) and I started moving back into my parent's place the days I was home from the races. FUN TIMES. Laughing
Deal with credit everyday & had a business go under back in '02. Financially & from a credit standpoint file a Chapter 7 BK. It draws a line in the sand with creditors otherwise you will spend the next 10 years cleaning it up. Wait about 6 months from discharge then pull credit monthly until everything is reporting as it should. Dispute anything that isn't. Carry a credit card or two through BK if you can and open a new one soon after and pay off monthly. Within 2 years you can be 700 plus scores...................it's business stop taking it personally.......feel free to email me if you have any specific questions. I deal with this regularly.....
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nytsmaC
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3/24/2022 3:19pm
ML512 wrote:
Credit related question... So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up...
Credit related question...

So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up around 100k in debt.

I've knocked out around 35k-ish already...so about 65k to go.

I'm really just down to my vehicle (used van, payment is pretty small) and a couple personal belongings, after selling anything I had of value.

I can probably knock out the remainder of my debt in 12-15 months depending on a few things. Thankfully I have dirtbikes through work to keep me sane since I literally can't do anything else because I'm basically broke within 30 mins of getting my pay check. From a credit stand point, do I continue down the route of just paying everything off since I can be out in just over a year...

BK route, how long does it take to recover on the credit side if you do everything "right"?

I know there's a lot of variables...just curious on a rough answer if anyone can pass on any insight.
Good job Michael, you are doing the right thing. BK or defaulting on debts should only be done if you have absolutely zero other ethical options.

The next 12-15 months will go by fast and you will not only have a huge sense of accomplishment to be proud of, but you will have learned some very valuable lessons the hard way. After that life gets easy again, and you can start to rebuild. You’ll be much wiser from the experience gained from this.

I got hurt pretty bad 4 years ago and wasn’t able to work for 6 months, and then at limited capacity for another 6-12. I’m a small business owner, self employed so there was no help out there for a guy like me. It cost me into the 6 figures, and as a guy who was an irresponsible spender this left me in a very bad position financially. I got out of it by selling off assets, taking some pretty heavy losses but it needed to be done, and some short term loans that I was able to repay fairly quickly once I got my feet back under me. It’s all in the rearview mirror now and it was a good life lesson.
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Brad460
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3/24/2022 5:04pm Edited Date/Time 3/24/2022 5:05pm
I would not declare bankruptcy over just $65k..

Try calling each creditor and see if they be willing to accept a reduced settlement, try combining debt, set up payment plans..etc…anything to stop negative items from hitting your credit.

Once you get things back on track…start accessing your credit reports from each agency on their website and begin submitting disputes for every negative item..The creditors have 30 days to verify the negative item, if they don’t it gets taken off your report. Do this over and over and over and over…this combined with on-time payments will improve your score quickly..You’d be surprised at how many creditors won’t respond. (Had to do this years ago after a divorce hurt my credit)..It works ..

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mxtech1
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3/24/2022 5:08pm
Have you given any thought to relocating out of California? Could you benefit from making Florida home base due to the significantly cheaper cost of living? Even if it’s just for a few years so that you can buckle down and get your finances squared away.

Otherwise man just keep your head up and realize all this is transitory and better years are ahead. i know it’s frustrating and stressful, but don’t let yourself get depressed over money. Sounds like you still have your parents and family in your corner, if needed, and a good group of moto dudes rallying around you to do good. You aren’t alone.
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borg
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Long Beach, CA US
3/24/2022 5:55pm
ML512 wrote:
Credit related question... So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up...
Credit related question...

So after folding up the team and thanks to the wonderful people who didn't do what they said they would, I racked up around 100k in debt.

I've knocked out around 35k-ish already...so about 65k to go.

I'm really just down to my vehicle (used van, payment is pretty small) and a couple personal belongings, after selling anything I had of value.

I can probably knock out the remainder of my debt in 12-15 months depending on a few things. Thankfully I have dirtbikes through work to keep me sane since I literally can't do anything else because I'm basically broke within 30 mins of getting my pay check. From a credit stand point, do I continue down the route of just paying everything off since I can be out in just over a year...

BK route, how long does it take to recover on the credit side if you do everything "right"?

I know there's a lot of variables...just curious on a rough answer if anyone can pass on any insight.
You need some advice from someone that's in the "bidness" but has nothing to sell you. Somebody you trust. Luckily for me I have a good friend that is pretty wise when it comes to this sort of thing. I will ask him what he thinks about your situation. Is it just you or do you have dependents?

I'm not discounting advice you are getting in this thread but in the words of the famous BobbyM "i mean we're fucking dirtbike riders for christ sakes.
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nytsmaC
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5946
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Frig Off CA
3/24/2022 9:15pm
It might be easier to default on a loan, but the way I was raised you pay your debts. Personal accountability. Some financial gurus might call it stupid, stubborn or foolish but I sleep well at night knowing I’ve always tried my best to do the right thing.
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Sully
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JP
3/24/2022 10:01pm
If it were me, I'd take Tracktor up on his offer to help before I made any decisions.
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Brad460
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Richfield, WI US
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3/25/2022 2:30pm
mxtech1 wrote:
Have you given any thought to relocating out of California? Could you benefit from making Florida home base due to the significantly cheaper cost of living...
Have you given any thought to relocating out of California? Could you benefit from making Florida home base due to the significantly cheaper cost of living? Even if it’s just for a few years so that you can buckle down and get your finances squared away.

Otherwise man just keep your head up and realize all this is transitory and better years are ahead. i know it’s frustrating and stressful, but don’t let yourself get depressed over money. Sounds like you still have your parents and family in your corner, if needed, and a good group of moto dudes rallying around you to do good. You aren’t alone.
I kind of laughed when I saw someone from IL giving advice to leave a crap expensive state..
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mxtech1
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1968
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Location
Galesburg, IL US
3/25/2022 6:28pm
mxtech1 wrote:
Have you given any thought to relocating out of California? Could you benefit from making Florida home base due to the significantly cheaper cost of living...
Have you given any thought to relocating out of California? Could you benefit from making Florida home base due to the significantly cheaper cost of living? Even if it’s just for a few years so that you can buckle down and get your finances squared away.

Otherwise man just keep your head up and realize all this is transitory and better years are ahead. i know it’s frustrating and stressful, but don’t let yourself get depressed over money. Sounds like you still have your parents and family in your corner, if needed, and a good group of moto dudes rallying around you to do good. You aren’t alone.
Brad460 wrote:
I kind of laughed when I saw someone from IL giving advice to leave a crap expensive state..
LOL....yeah, IL isn't exactly the model state.

However, our real estate prices are affordable & cost of living is low, even with all of the state tax burdens.

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