Can someone settle this debate?

[Thomas_Thumb]

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@SRT4kid93 wrote:

Can I ask..why are there so many forum members that have filed?

It seems like a shocking amount of members have declared bankruptcy. I had no idea it was so common, and it's even more surprising to find bankruptcy in such high numbers on a FICO forum. 

I mean before I joined this forum I never met a single person who filed bankruptcy and since joined it seems like 8 out of 10 people filed at one point or another. 

why do you think there are so many members that have filed on here? Is it because many members are older than I am, and had to live through the 2008 housing crisis?

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Well, every year lived presents an opportunity for hardship and credit mismanagement. So, a 25 year old is less likely to have experienced a bankruptcy or even a late payment than a 45-65 year old.

Still, as you point out, the % of people on the forums having filed is high - even factoring in age. As mentioned by others, the cohort is likely skewed high because the forum includes bankruptcy, rebuilder and mortgage topics that attract those looking for help.

I've been through multiple job losses. My wife and I both lost our jobs the same day in 2004. The company we worked for slashed head count 35% at its corporate Engineering and R&D center. A group announcement had been made that organizational changes were coming and everyone needed to be on site for Friday meetings. HR brought in a couple armed guards for the occassion. Nice touch - not.

We were mid 40s then and thankfully  had sufficient after tax funds to manage our financial obligations. We had monthly mortgage payments but, they were low enough to allow for substantial saving during good times. Fortunately we received severence packages after signing non compete agreements. (8 months severence for her, 6 months for me)

I moved to a different state for a new job just as my severance ran out. DW and daughter stayed behind until school year ended 6 months later. Our home went under contract in March above asking price with a buyer who was ok with a June close date.

After moving it was 3 years before DW landed a job. We were unable to save during that time except what was taken out for a company 401k match. Just 2 months after her job started I was looking for work again. Things got very stressful and the job market was quite depressed in 2009.

We tried to maintain a lifestyle where we could manage on one income. However, our after tax savings dwindled during periods of single income. We avoided any late mortgage payments and always PIF credit card balances. Only lates in 40 years have been a couple medical bills that went 30 days. Good thing those aren't reported.

[SRT4kid93]

Wait medical bills aren't reported?

since when? I know the newer FICO 9/10 models made adjustments so that medical bills have less of an affect, and I believe any bill that went to collection and was then paid off, no longer has an affect as well.

but I never knew medical bills didn't affect your credit? My mom lost 100 points off of her score for not paying a medical bill a couple years back. 

[Thomas_Thumb]

@SRT4kid93 

I mentioned 30 day lates. Lates on medical bills are not reported. Turning over the debt to collections was threatened but never reached that threshold. I guess you extrapolated my comment to include collections.

Heaven forbid collections. There are now some provisions prohibiting reporting of certain medical debt to CRAs by debt collectors under the 2022 "no surprises act". I don't recall the specifics or what other regulation may now exist. Try searching for them.

Paid collections, medical or otherwise, of any amount don't count against you on Fico 9 and Fico 10. However, they still count on Fico 8 if over $100 and on the older Ficos regardless of amount. To prevent them from counting they need to be removed from your report.

After some reg changes, many/most types of liens had to be removed from reports regardless of age. However, removal of existing ones that qualified was not always automatic. A dispute sometimes had to be filed to get the job done.

Unpaid collections under $100 don't count against you on Fico 8 but can on Fico 9. The later Fico models, with the backing of creditors, decided the incentive to ignore collections should be tied to payoff - not some unpaid $ threshold. Gotta get that copay revenue.