@ScoreBooster wrote:
@StartingOver10 wrote:If you have zero balance acccounts close them before you file BK. Even if they report zero at the time of filing and remain open, the creditors will get automatic notification of your BK filing and they will report each account iib (included in bankruptcy).
The only way to keep the accounts in good standing is to close it with the zero balance before you file. Close it now if you plan to file in the next 90 days.
I strongly disagree.
Although a CC-company might report a $0 Balance at filing tradeline as IIB, they are not allowed to do so because this would be a violation of the FCRA. The FCRA requires accurate reporting and an account with a $0 Balance can't be IIB - it's technically impossible. BKs only include debts and assets - but not accounts with a $0 Balance.
Therefore, I recommend that you DON'T close accounts with a $0 Balance prior to filing and DON'T list them on your BK-schedules. This gives you at least a very tiny chance that a $0-Balance account survives the BK. If you close them right away, you are giving away this tiny opportunity - for no reason at all.
That's what I did and two accounts survived and are still fully funtional - more than 3 years after I filed.
Not only are you DEAD WRONG, you are asking people to open themselves up for BK fraud. This is horrendous advice and no one should ever do this. You got lucky that is all. Open accounts with zero balances CAN and are often closed and remarked included in BK whether you listed them or not. The reason is simple YOU ARE NOT ALLOWED TO EXCLUDE any creditors in a BK filing. Wether they have balances or not is irrelevant. You are NOT allowed to exclude ANY creditors! Other than getting your case dismissed, it could be considered BK Fraud.
This is why you should close all accounts with a zero balance prior to filing and get a positive albeit closed tradeline reporting for ten years. If you leave them open and file 99% of the time they will be closed and IIb'd which is correct reporting. Not listing your creditor also doesn't prevent them from finding out and IIb-ing the acount to protect themselves.
The best thing to do is close the accounts with zero balances, that way you keep the positive standing and you don't have to lie on your BK petition.
Starting Score: 501No, this is incorrect.
As I said before, you are required to list all DEBTS and all ASSETS.
Credit cards are supposed to be listed under Schedule F on your BK Petition. I advise you to take a very close look at what the Petition (B 6F Official Form 6F) says:
SCHEDULE F - CREDITORS HOLDING UNSECURED NONPRIORITY CLAIMS:
"State the name, mailing address, including zip code, and last four digits of any account number, of all entities holding unsecured claims without priority against the debtor or the property of the debtor, as of the date of filing of the petition."
So what claim does a CC-company hold against you when your account has a $0-Balance on the day you file for BK? You guessed it right - NONE!
Technically, you are filling out an INCORRECT petition by listing a party you don't owe any money to under Schedule F. In fact, there is no section on the BK-petition where you can correctly list accounts with $0-Balances. It's simply not there. If you disagree, I kindly ask you to show me where.
The claim that leaving out an account with a $0-Balance is considered BK-fraud is the biggest nonsense I ever heard.
And no, I'm not wrong either in claiming that the reporting of a $0-Balance account that wasn't even subject to your filing as IIB is a FCRA-violation. If it's not part of the BK-procedure, please explain to me how a reporting of IIB can be "accurate" in the first place. An account with a $0-Balance and left off the petition simply can't be IIB. Plain and simple.
No doubt that $0-Balance accounts are closed after BK 9 out of 10 times. That's what I meant by "tiny chance of survival" - but this is the creditor's sole decision. Now, if YOU go ahead and close the account right away, you won't have the chance to get lucky in the first place. They certainly can close the account due to the fact that the consumer filed for BK - but they are not allowed to report the account as included in bankruptcy because it wasn't. Sure, they do like to report it that way - but they aren't allowed to and if you can prove that the account balance was $0 the day you filed and wasn't listed on your schedules, you have every right to dispute this inaccurate information. By voluntarily including these accounts on your petition, you are basically making the case for the creditors to list an IIB-notation on your credit report. That's really not the smartest move..
One of my CC-cards that survived was a secured card. I paid it off to a $0-Balance prior to filing (which I was allowed to do because it only carried a small balance) and left the CC-account off my petition. However, I listed the account that served as security deposit for the CC as an asset. My second CC that survived was an unsecured CC with a small CL as well. I paid that off, too. $0 Balance = neither asset nor liability = no requirement to list the account on the petition.
Everything was legal and certainly not "fraudulent". If you avoid making preferential payments (not paying more than $600 to a single unsecured creditor within 90 days prior to filing), you are good to go.
So please enlighten me where I "lied" on my BK-petition by not including $0-balance accounts.
You should get the facts straight before accusing others of lying. Ridiculous!
@BobbyJ wrote:
My attorney, one of the largest and best in San Diego, CA stated that those accounts would not be included because technically I do not owe them anything.
Bingo!