Yet this is not a common problem… in fact, it probably happens in a major bankruptcy law firm for clients once per 12 month period. The purpose for providing this information revolves around the fact that this issue did not pop up a single time in 2013 but rather just once in this month, January of 2014, for the clients involved in this law firm, and the year is actually already completed.
An interesting and fascinating reason for this situation could arise due to the fact that as the credit card issuer could still be operating under the Metro system rather than the Metro 2 credit reporting system. In the year 2006, the Fed reported that as much as 50% of credit reporting to the bureaus was based on the Metro system.
What About Situations Where The Credit Account Does Not Get Paid?
If neither you nor the co-borrower or cosigner pays the original debt, there will most certainly be a mark on your co-signer’s credit. In this situation, the same holds true as with the situation where the debt continues to be paid. The debtor who has filed for bankruptcy protection will show bankruptcy, while it would likely show as a late pay, a charge off, or collection account for the co-signer if the account continues to go unpaid. A credit ”Charge off” would be considered to be a “serious derogatory” for a person’s credit profile. This kind of a major derogatory can be considered by many to be nearly or even as completely bad as a bankruptcy itself.
They say that it is an ill-wind that brings only bad news, and hence it is important to realize that bankruptcy is designed to protect, not to hurt. If you believe that you could benefit from a bankruptcy, you would do well to consider discussing your options with a trusted financial adviser, a bankruptcy attorney, a CPA, or some trusted family member.
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