Bankruptcy- ?'s and advice?

[watchdogps]

Ditto on Dave Ramsey - I took a poll of my friends about what route to take (bankruptcy, debt consolidation, etc) and Everyone who had done his program LOVED it! We just started and it's really realistic.

 

[Livinzoo]

I'm thinking about bankruptcy too. I have over $20,000 in credit card debt. It raises about a grand a month. I haven't paid on them since January. I stopped paying on my house in August. It was foreclosed on in May. I had a house from my first marriage that I was trying to sell and my current husband also had a house. When I went out on short term disability when I was pregnant I couldn't afford to keep paying for an empty house. Once my credit started tanking the credit cards raised my rates so high I could no longer afford to pay them. Then I also live in a state that allows the mortgage company to come after me for the difference. If they sell it for what they have it listed for that is about $30,000. But if they don't come after me I was told I will have to pay taxes on any of this money I'm let off on as if it was income. There is no way I'll have this money in the next few years.

I know where my down fall was and it was getting that house with my ex husband. When we divorced I got stuck with it since the note was in my name because his credit was so bad. I did my best to hold on, ringing up credit card debt just to be able to pay for the house. I should have let it go a long time ago.

 

[HeatherLynn]

I think you should check out Dave Ramsey whether you file or not. Either way his way works. We went on his plan after bankruptcy to pay off those last debts we kept and to put ourselves on a track that would prevent us from ever being in that situation again. Its nice to be able to breathe again and to have security.

 

[Krysstyllanthrox]

We were there last year. We sat down, talked with an attorney who laid out all of our options. In our state, even with me on unemployment we would have had to file for Chapter 13 which is the debt repayment plan. We left the meeting even more frazzled. It costs money to file for bankruptcy. And more than that, with Chapter 13 you basically hand over your financial life to the courts for the next 5 years.

No new car (even used), but you are allowed to put as much money into your existing car as you have to; so if it dies beyond salvation, you're screwed as you aren't even allowed to pay cash for a clunker.

If your creditors find out you get a raise, they want their portion of the payout settlement upped.

The 'friend of the court' decides what your monthly budget is and where your money goes to. You get very little say over it.

If you have student loans you still have to pay for them. If you have a co-signer they can go after your co-signer once you declare bankruptcy.

No using credit. ie, you have a house repair you can't afford to pay for all at once but if you financed it you could pay for it in 6 months. You are S.O.L.

The afternoon after our sit down with the attorney Hubs went back to work. His boss asked him what was wrong, he told her. She urged us to go talk to Consumer Credit Consuling Services. The one here is backed by the United Way. We went and talked to them. They listed to us and worked out a payment plan that will pay back all of our CC debt within a few years. They listed to us when making out our budget and we got to insist on some things the court wouldn't have allowed. We need some house repairs that we don't have the cash for as I just got a new job a month ago. We had to ask permission but we are allowed to use credit and have to agree to be responsible about it. For us CCCS was the way to go. Working with them also got the collection calls to stop. We just tell anyone that calls to talk to our guy at CCCS.

If you go the CCCS route, make sure they are backed by a non-profit. You shouldn't have to pay through the nose for their services. We pay a $30 fee every month for them to manage our accounts. And it must be working as we are once again getting CC offers in the mail... Those get shredded asap.

There are other options out there beside bankruptcy.