Just curious...

[CreditScoreImprovement24]

From what I gather (and I am very young and admittedly stupid/new to credit cards so please enlighten me if I am incorrect on this), but it seems like going into debt is no problem because you can just do BK chapter 7 and in like 6 months already can have a credit card with a limit as high as even 3000 and the sky is the limit after that.  

It seems you can just get into massive debt and nothing of consequence really happens because you just do ch 7 bk.  Reminds me of that scene in the Office where Creed mentions to Michael that BK is nature's do-over and a fresh start lol...with Oscar rolling his eyes in the corner haha.

Anyway, that is what I gather after reading several posts on the internet about it. 

How right/wrong am I here?  What am I missing here?  Anyone have a different experience?

Note:  Obviously this is just out of curiosity...I always pay in full and have zero debt right now and plan on keeping things that way.

[JoeRockhead]

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@CreditScoreImprovement24 wrote:

From what I gather (and I am very young and admittedly stupid/new to credit cards so please enlighten me if I am incorrect on this), but it seems like going into debt is no problem because you can just do BK chapter 7 and in like 6 months already can have a credit card with a limit as high as even 3000 and the sky is the limit after that.  

It seems you can just get into massive debt and nothing of consequence really happens because you just do ch 7 bk.  Reminds me of that scene in the Office where Creed mentions to Michael that BK is nature's do-over and a fresh start lol...with Oscar rolling his eyes in the corner haha.

Anyway, that is what I gather after reading several posts on the internet about it. 

How right/wrong am I here?  What am I missing here?  Anyone have a different experience?

Note:  Obviously this is just out of curiosity...I always pay in full and have zero debt right now and plan on keeping things that way.

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Having debts discharged through a bankruptcy isn't a right that's guaranteed.  There's a number of things that can get a bankruptcy case dismissed including fraud and abuse of the system.

If someone is found to be abusing the system as in your example by repeatedly racking up debt, and filing for BK.  The likelihood of their case being dismissed goes up greatly. 

Once their protections of BK are stripped away,  there's nowhere to hide.  Creditors will sue,  be awarded judgements and depending on the state, can be renewed indefinitely, essentially following them around for the rest of their lives.  Even if they move to a different state, judgements can often be transferred. There's also the possibility of catching criminal penalties.

[odd_dog]

You should rack up some debt, claim bankruptcy and post about it, that way you would have first hand experience.....funny someone on here that is a "valued member" should understand finances and debt by now.....just sayin......

[Anonymous]

My fiancés uncle has filed both personal and business multiple times. He will tell you that "it's all legal" and laugh about doing it again. He simply doesn't care and has often "restructured" his business and opens and closes them as he sees fit. He is still wealthy and never changes any of his spending habits. He's the type of sleezeball you're probably thinking about. 

[Patient957]

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@odd_dog wrote:

 "valued member" should understand finances and debt by now.....just sayin......

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If only that were true.

But I think the OP understands just fine.  I see the question more as a Devil's Advocate type thing.

[CreditScoreImprovement24]

@Patient957 

Indeed, I am just playing devil's advocate/genuinely curious since I have seen so many people almost brag about their bk being a joke that allowed them to be rich and was basically free money blah blah blah.  

[Patient957]

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@CreditScoreImprovement24 wrote:

@Patient957 

Indeed, I am just playing devil's advocate/genuinely curious since I have seen so many people almost brag about their bk being a joke that allowed them to be rich and was basically free money blah blah blah.  

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I've seen lots people discuss their BKs here, but I wouldn't say I've seen anyone bragging about it or suggesting it as a way to get rich.  

I've seen one guy on here bragging about his COs, but he just seems luke a loser, and I'm pretty sure he's not getting anywhere near rich off it.

[dfwxjer]

I used to work on the creditor side and can confirm that BK is not a cheap process for the average individual. On top of the hefty attorney fees to file, there is a resulting increase in borrowing/insurance costs, and lasting damage to one's credit report that can affect jobs/ability to find a place to live. 

At the end of the day it's all about the cost benefit which is unique to every situation. Low net worth people get hit the hardest because they are typically at the end of their resources and have no other way out. Higher net worth people and businesses might find it's in their best interest to file since they have already accumulated assets they need to protect. 

[markhs777]

Filing BK is just an uncomplicated way of making life easier whether for an individual or business. It's 100% legal so no judgements should be made. 

Yes there are consequences but apparently less so than not filing. Businesses repossess cars and foreclosure on homes and resell them for additional profits when tough times are had by the borrowers.

There is always a segment that will take advantage of situations or even what some may consider legal loopholes in our society. Committing fraud is one thing but legally bettering themselves is quite another. The great majority don't brag about it. If they do being a jerk is not illegal.

[Minimalist]

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@CreditScoreImprovement24 wrote:

@Patient957 

Indeed, I am just playing devil's advocate/genuinely curious since I have seen so many people almost brag about their bk being a joke that allowed them to be rich and was basically free money blah blah blah.  

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Your first mistake (not YOUR mistake, just in general) would be considering credit free money.  It's a loan, using your credit card for groceries is getting a loan for groceries, that you are obligated to pay in full (without interest) or over time (with interest, and not recommended).  Bankruptcy is also a way of telling you that what you did in the past isn't gonna work, and it's time to get things straight financially before you consider even looking at another credit card. Funny how there are so many credit card companies who will gladly loan to a particular user, then wind up taking it in the shorts when said user defaults or files for bankruptcy.  Also funny to see people go over the 3-card threshold which provides diminishing returns and more bills coming in that are a royal pain to keep track of, then they don't consider the 'Finances before FICO' saying, and have no savings or emergency funds to back up their spending in case the SHTF somewhere down the road, which in this economy is bloody likely. I'm a big believer in 'actions have consequences', and anyone who tries to milk the system thinking they can get away with it will wind up paying for it dearly in the end.