File Chapter 13 or Use company Debt Consolidation?

Anonymous · ‎09-03-2017

My salary is 78k and I owe 25k in unsecured credit cards. My mortgage is 1,900, my car payment is 480.00 a month and other household expences. I also pay 300.00 for 3 more years in Alimony. I can keep up with the payments each month. Not sure what to do at this point. The attorney told me me i would pay around 200.00 a month for 5 years for the Chapter 13.

Anonymous · ‎09-04-2017

@Anonymous wrote:
My salary is 78k and I owe 25k in unsecured credit cards. My mortgage is 1,900, my car payment is 480.00 a month and other household expences. I also pay 300.00 for 3 more years in Alimony. I can keep up with the payments each month. Not sure what to do at this point. The attorney told me me i would pay around 200.00 a month for 5 years for the Chapter 13.

My first thought is that you are probably more in need of a budget and trimming expenses than you are a BK.

25k of debt on a 78k salary is something you should be able to get out of.

For starters, I'd get a cheaper car and consider moving to help get out of debt. 78k is a good salary, but IMO doesn't support a $1900 mortgage and $480 car payment.

Anonymous · ‎09-04-2017

Not sure how i can get out of a new car payment and i am trimming some expences but all the payments are again difficult to make. 2 cards are almost 120 days late.

Anonymous · ‎09-05-2017

@Anonymous wrote:
Not sure how i can get out of a new car payment and i am trimming some expences but all the payments are again difficult to make. 2 cards are almost 120 days late.

Whether you choose to go the BK route or not, your mortgage and car payment are 50% of your take home pay. Even if you get out of your current situation, I think this is going to prove to be problematic again in the future if you don't correct these.

If you sell the house and get a reasonable car payment (or better yet, one paid for in full) I think you could both get out of this $25k of debt now PLUS be able to properly contribute to retirement and emergency savings beyond that.

Anonymous · ‎09-05-2017

@Anonymous wrote:
@Anonymous wrote:
Not sure how i can get out of a new car payment and i am trimming some expences but all the payments are again difficult to make. 2 cards are almost 120 days late.
Whether you choose to go the BK route or not, your mortgage and car payment are 50% of your take home pay. Even if you get out of your current situation, I think this is going to prove to be problematic again in the future if you don't correct these.

If you sell the house and get a reasonable car payment (or better yet, one paid for in full) I think you could both get out of this $25k of debt now PLUS be able to properly contribute to retirement and emergency savings beyond that.

I tend to agree with Steeler. If you have any equity in the house, sell it, move into a cheap apartment for the next one to two years. Use the equity to pay down the balance on the car and then either refinance it or trade it in for something less costly. Use the savings from those two payment reductions to attack the 25K CC debt. In two years you can be nearly debt free and will be ready to get another home - one with a more modest payment.

Anonymous · ‎09-06-2017

I just bought my house last year so im not ready to sell it. My girlfriend is trying to find work to help so will see how that goes. I also applied for loss mitigation to see if i can get my mortgage payment lowered and extend the loan term.

Anonymous · ‎09-06-2017

@Anonymous wrote:
I just bought my house last year so im not ready to sell it. My girlfriend is trying to find work to help so will see how that goes. I also applied for loss mitigation to see if i can get my mortgage payment lowered and extend the loan term.

You could also rent out the house, move into a $1000/month apartment for a year or two, dig out of debt, then take your house back under completely different financial circumstances.

Anonymous · ‎09-06-2017

Yeah, if there is no equity to use up, thats not a good option. Explore the rental market as Steeler suggests. GF getting work will go a long way - even a minimu wage job is going to pull in a grand a month.