To file for BK7 or not to.......Help!

[BigItaly]

Ok, so I have approximately $20k in debt. Most of it all medical bills. I have a car loan at 29% interest rate. I have to get out of it, as I'm clearly upside down on the loan. I can't get credit from anywhere. My scores are  (Trans 565, EQ 533, EXP 521) So, I'm not sure if it would be beneficial or not for me to file BK 7. Let me know what you think, experts chime in. I need a new car, The car I have is a dead end.

[ezdriver]

From the limited information posted, I am inclined to say that filing bankruptcy, if you qualify to do so, would be too drastic a step to take. As difficult as it may seem, it is possible to arrange payment for less than the full amount owed. I don't know what to recommend about the high-interest auto loan other than to consider giving it up, and buying for cash, a car that provides basic transportation until you recover financially. Many folks here, including me, had done just that.

All the best ... always.

[BigItaly]

This car is a money pit. When you say "give it up" you mean let it get repossesed? I've kept the auto loan in good standing for 8 months which is how long I've had the car. 

[ezdriver]

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@BigItaly wrote:

This car is a money pit. When you say "give it up" you mean let it get repossesed? I've kept the auto loan in good standing for 8 months which is how long I've had the car. 

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Yes, I meant calling the loan company and telling them to take it ... or selling it and pay off the loan if possible. I once gave up a 2000 Porsche 911 and bought a '93 Buick Roadmaster with seller financing as one step in my setting myself up for recovery/rebuilding of my credit profile. It worked.

[BigItaly]

Everyone says to keep it and continue to pay for it. Getting it repossesed .......wouldn't that be making it worse? I can't get financed now for anything. I'd have to come up with cash to get something else. And, I don't have that to come up with.....

[BigItaly]

Anyone?

[StartingOver10]

BK is a huge step.

You only gave very brief information about your debt. Your debt is very small, naturally it may not feel small in relation to your income but you didn't give that information.  It isn't really possible to even hazzard a guess without more info - your income, housing etc.

If you go to a Bk attorney for a consultation they will recommend Bk because that is how the attorney makes his money.

It may in fact be better for you individually to NOT file BK and work out settlements.

Check out http://www.daveramsey.com/home/

[NotTellinYou]

Please visit any number of NON-PROFIT credit counseling organizations for advice like this. Need a bigger picture if what you have and they can assist you in working with your creditors to get you into a better position.

For example:

http://www.nfcc.org

good luck!

[BigItaly]

Ok, well here is the situation. I got divorced and moved in with a friend. Don't own a home yet, I do have an extremely high interest rate loan on a used car, that has been a money pit. Most of the debt I have is old medical bills. That's it. My friend listed me as an authorized user for one of his cards that he just got and that's about it.  The auto loan is in good standing and has never had a missed or late payment, but my score is at a stand still. The credit card hasn't reported yet. But it's in good standing as well. That's the only positive things on my credit right now. Other than that, I can't get approved for ANYTHING! There are close to 30 inquiries on my report , most of which I have no idea where they came from, because I haven't applied for credit since I got the auto loan which was last year. i've tried disputing them and they still remain. I can't get store cards, been turned down on secured cards through my bank, regular cards, etc. I really don't want to file bankruptcy but I need a clean slate. I'm afraid that if I file for BK 7 I'll end up in a worse position. 

[amber78]

Im by no means an expert. Im recently divorced as well.. but we have over $50K in CC debt,  not to mention two homes going to foreclosure.. and add an as# of an ex who refused to cooperate.. so for me it was a no brainer.. and I go to file my papers for CH7 next week.  Before I filed though I have made it a mission to clean up my CR.. and if you look.. ive done pretty good so far.. 

There may be hope for you yet.. if it were ME.. what I would do is call all the old medical providers and explain the situation. Sometimes if they know you dont have insurance or there are other circumstances.. they will drop the amount owed and work out a payment plan.

Once i deal with that.. I would get to work on your CR.. do all you can to fix errors as suggested on these boards.. 

I would try that before BK if it were me..