Thinking of BK

[forgetmenot10371]

So Dh & I have been thinking about BK for the past month, and I thought I would see what some "outsiders" think.

I was laid off in May. Between unemployment and DH income, we were able to pay everything expect our 4 cc's.  They totaled about $635 p/ in payments: $7k, $25k, $3.7k, & $2.6k = 38,300 in credit card debt.

We're getting to the point where we are 120 past on these and atleast one has sent us to a collection agency.

I just found a FT job that I will be starting next week, but it's about $6,000 less a year than I previously making and I honestly don't see us being about to afford to pay more than $100 or $200 a month towards debt.

The $25k & $7k balances scare me - I know eventually they will sue us for the balances, but this bank is just unwilling to work on lowering the payments.

Is it worth us seeing a BK attorney for almost $40k or should I just wait until the CC sue us and worry about it then? I've never been in this position in my life and just am not sure what the right course is for us to take.

Thanks!

[Anonymous]

Hi forgetmenot,

This is a great time to get information - I wouldn't put it off because you may reduce your options.  Even though it may be stressful, it might be exactly the right time to meet with a BK attorney (or preferably two) and see what the options are.  You'll find out if you qualify for BK, and how it would impact you.  Most attorneys in my area do a free consultation.  If you can outline your financial situation on paper, it'll help you get the most info and feedback out of the consultation(s).  It's also a great time to meet with a non-profit debt management group.  Watch out for sheisters in this area - look for a reputable non-profit group.

I think information is your best tool.  Good luck and best wishes as you work your way forward.

[elcarmom]

hi.. our chapter 7 bk was just discharged in august.. i didn't want to do it drug my feet...same position my husband lost his job we had barely enough money to feed our kids..we had a car repoed and were behind on everything... when we filed our fico was in the 400's just pulled them on friday and they are 528/568/608... was the best decision we could have made... good luck

[Anonymous]

Settle at 20%, not too shabby.  I would but my debt exceeds $200K so BK7 will be my way out.  Even if I did settle I don't think I could qualify as insolvent to avoid taxes.