Re: Divorce and Debt Settlement
12-15-2010 04:46 PM
After getting divorced in March at 38 years old, and having $42,500 of debt that needs to be settled given that I can't even make the minimums each month, I would like to know how much worse my FICO is going to get and for how long. Equifax was a 632 in march and is now a 574 Trans is 632 was 687.
I have a decent job ($50,000) but have three children to support and have been considering cashing in my retirement to pay off my debts, rather than debt settlement. To do this, I would have to quit my job and relocate to another state to work since I am paying into a private retirement system. Has anyone made this kind of choice and if so, was it wise or unwise? Should I take the risk of quitting a decent job and starting over elsewhere to get out of debt or should I just do debt settlement and have no effect on my retirement.
I would be very careful in the choices made. Giving up a job these days is not something to be taken lightly.
You mention about $44k in debts. Could you break those down? Some debts, like child support, almost never go away and ignoring them could land you in really hot water. Others, like unsecured debts, can probably be negotiated for a lower payoff / reduced interest rates. Depending on what type of debts you have and how precarious the situation is, bankruptcy could be an option.