credit card debt - what are my options?

[freedom14]

Hi everyone,

I'm drowning in credit card debt that have ballooned for mistakes, mismanagement, and unforseen circumstances. I won't bore you with the life circumstances that led to this. I'm looking for solutions/suggestions as to how best to tackle this.

Situation:

-I have roughly $45k in credit card(s) debt from Chase, USAA, Citi, Discover, and AMEX. They have been 0-120 days late at this point. One card has been cancelled recently and the others are most likely following suit quite soon. None of them have been chargedoff just yet.

-I'm unemployed/underemployed, but working on employment as we speak.

-Could possibly get 5-10k from family to help.

-No assets and no other outstanding loans.

Quite depressing to be quite honest. I'm kicking myself for being an idiot. How can I best tackle this when I am unemployed/underemployed at the moment. I don't have reliable income and that is what I am working on fixing. I could possibly get 5-10k in cash from family (if I beg them) to help me settle some of it if that's indeed an option. It seems to me that it's just too much for me to pay back and I'm seriously considering filing for bankruptcy as I see no other options.

How would you tackle this? What are my options? 

I welcome all thoughts and suggestions regarding this. Thank you in advance.

[Brooklyn2018]

Hi, freedom14!

Didn’t want you to think anyone was ignoring you thread. It’s seems yours might require another contributor to chime in and offer some advice as how best to approach your situation(?) Glad to know you’re seeking help to better you status financially. That’s a PLUS!!👍👍👍

I wish you MUCH SUCCESS!!

😊

[cyrusvalentino]

In my opinion because you are still unemployed or underemployed you do not want to take the $5,000 to $10,000 and then be left with no fall back plan in the event you have an emergency or something come up. I’d think in your situation if you haven’t already reach out to the creditors ask if they have hardship programs, some even carry unemployment insurance if your opted in for it like Credit One Bank. I know during my hardship Capital One waived all interest, and several other steps to help me get back on track as did other creditors. So if you haven’t done so yet I’d try to contact the creditors and see what hardship offers they’ve got for you.

CO usually doesn’t occur until your more than 6 payments behind, i would try all options to avoid bankruptcy and bringing the account satisfactory.

[Anonymous]

Check out Dave Ramsey. He has a podcast and YouTube channel. His debt snowball method would help you once you are employed

[EW800]

So sorry to hear about the significant debt.  Been there, done that, know the feeling...

Not sure if this is feasible or not in your case, because of the unemployment/underemployment situation, but I will share with you what my wife and I did about seven years ago.  We had about $60K in credit card debt because of some bad decision and some very painful life issues.  We were getting killed with interest, obviosuly.  I did have to "settle" with one credit card company, however we then took every dime that we would have paid them and paid the others.  At the same time, we pretty much ate rice and beans for two years, spending money pretty much on just the extreme necessities.  After two years of doing this, we found ourselves completely debt free and were able to start saving all the money that had been going to the credit card devils.  We took a big hit to the credit scores because of the credit card settlement (and foreclosure as well), but it was great to be out of debt and the baddies will be falling off our credit reports just a matter of months from now.  

You will likely get better advice from our experts, but wanted to throw out there what worked for us.  

Best wishes!  

[freedom14]

Thanks for all the replies so far.

I'm considering all my options and just feels suffucating at this point. I'm leaning towards bankruptcy because at least that way I can see some light at the end of the tunnel. I don't see how I could pay off this debt any time soon given my current unemployment/underemployment situation. I'm working to fix that but not sure when that will change. 

For those who have gone through bankruptcies, what are your thoughts and opinions? Was it a good move? Did it hit you psychologically having gone through that? Or was it just a big moment of relief?

[cyrusvalentino]

I'm sure the users in the bankruptcy forum could definitely lend some advice on the process, on what type of bankruptcy you should file. I personally still don't think it is your only course of action, you should contact the creditors and if you have a great history with them they may work with you given your hardship. I know mine did, and honestly while bankruptcy may seem the easy way out. As with most things in life what appears to be the easy way out isn't always as such and usually has ramifications that will have a lasting effect on your life for the foreseeable future. But that is my opinion I'm sure others may disagree.

[freedom14]

I'll ask the bankruptcy specific questions to the folks over at the Bankruptcy section of this forum.

So let's continue with more questions about non bankruptcy situations. What happens if I let it all go to chargeoffs (a realistic possibility unless I come into money very soon!) and then collections? How does that differ in terms of hits to my credit? What are the likelihood of getting sued by the credit card companies before or after the chargeoffs? I don't have much in terms of assets and was just wondering out loud how that affects me considering I don't have anything to give them. Trust me, if I had money, I'd pay it all up now to make this all disappear. That's just not the case at this point in time. I'm just wondering what the difference between letting it go to chargeoffs/collections vs BK would be considering it'll be on my credit report and affecting my credit for years. FYI, not planning on buying anything with credit (car, house, diamond ring) anytime in the next 7 years.

I really appreciate the replies so far and I look forward to more. Thank you!

[Anonymous]

if this is my personal debt total 45k, ill go with BK option. There is a life after BK. Don't worry OP.  Please do your research first which option the best for you. Best of luck. 

[cyrusvalentino]

I would try to fight them going to chargeoff, did you try to contact the creditors as I suggested about hardship programs they may offer? There are other options but first step is try to salvage the relationship with the creditor in any way possible.

Here is a great article I found when I used hardship programs myself: https://www.creditcards.com/credit-card-news/credit-card-hardship-program-debt-problems-1273.php