My bankruptcy journey begins...

[Horseshoez]

@masscredit, if that's your only debt, it might be worth taking the offer, however, if I recall correctly, it is just a small segment, which means bankruptcy is still on your horizon.  If I understand the Chapter 7 rules correctly, even if you pay NFCU and then file for bankruptcy, the Trustee will attempt to claw back virtually all of the money you've paid them and you'll be no better off.

[masscredit]

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@Horseshoez wrote:

@masscredit, if that's your only debt, it might be worth taking the offer, however, if I recall correctly, it is just a small segment, which means bankruptcy is still on your horizon.  If I understand the Chapter 7 rules correctly, even if you pay NFCU and then file for bankruptcy, the Trustee will attempt to claw back virtually all of the money you've paid them and you'll be no better off.

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The balance on that card is just a small portion of what I owe. My total is probably in the $150K-$160K range. I'd consider a settlement offer if they were all offering pennys on the dollar. Like 10-15% of what I owe but that probably wouldn't happen. Even with that, all of my cards with balances are now approaching 120 days late. So what would be worst, a bunch of cards with those late payments or them and a BK? The BK will be on my reports 3 years longer than the late payments. I might be wrong but I believe it will be easier to get my scores into the 670-700 range after a discharge (2 year plan) over recovering from all of those lates with no BK? 

[Horseshoez]

@masscredit, with that kind of debt it is a slam dunk no-brainer; file Chapter 7 and move on with your life; two years from now you'll be in a position to apply for a mortgage, and have respectable scores.  The flip side is, if you don't file, it is going to be a long 7 years of credit prison.

[sccredit]

I had much more debt than you when I filed - all of it from a really bad business deal. I had no problem telling creditors I was going to file along with a simple "there is now way I can repay this much debt in my lifetime, my only option is bankruptcy". After telling everyone that (Citi, Chase, Barclays, Discover, US Bank, NFCU, DCU, Logix FCU, CapOne, Amex, PenFed - probably more I can't remember) and the only one that took any further action was Discover. They sent it to collections. US Bank called non-stop. Everyone else went quiet. After I filed the only creditor that popped up was Navy, they sent a letter to the trustee stating that they would only accept reaffirmation on my truck if I reaffirmed all debt with Navy. My attorney told them to kick rocks and pick up the truck.

Here is my advice - just file.

[masscredit]

Thread update - I'm been putting this off because I've had other things going on and just didn't want to deal with it. I haven't answered one phone call from the credit card companies and haven't opened any mail that they have sent me. Well, it's time to deal with this. Not becuse the calls and mail are bothering me. I want it over so I can start rebuilding. My EX08 score is currently 482 and it will probably take 2 years from my discharge date to get to the 680 range. I just got off the phone with an attorney's office. I'm going for my first consultation next Tuesday.

The woman I spoke to provided a list of things I should bring with me (2019 and '20 taxes, last 6 months of income, car loan statement and list of current bills). What are some important questons that I should ask? And should I go with this one if I feel good/comfortable with the answers or should I definately meet with two-three others?  I found this firm at avvo.com. The two attorneys there have good reviews. 

[Horseshoez]

Congratulations on taking the next step!

I would ask lots of questions about money made in the immediate run up to filing and any windfalls you might have, be they tax returns, lottery winnings, inheritance, whatever, you might become entitled to before filing, between your hearing and discharge, and after the discharge, which the Trustee might want.  I would also ask how sure the attorney is regarding the Trustee's comfort with the filing, and what odds the US Trustee might want to get involved with an eye to a dismissal or a shove to push you toward a Chapter 13.

[masscredit]

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@Horseshoez wrote:

Congratulations on taking the next step!

I would ask lots of questions about money made in the immediate run up to filing and any windfalls you might have, be they tax returns, lottery winnings, inheritance, whatever, you might become entitled to before filing, between your hearing and discharge, and after the discharge, which the Trustee might want.  I would also ask how sure the attorney is regarding the Trustee's comfort with the filing, and what odds the US Trustee might want to get involved with an eye to a dismissal or a shove to push you toward a Chapter 13.

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I don't expect any windfalls to be coming my way in the near future unless I will Powerball. Income will remain the same or lower. I have some control over that. And I usually have to send money to the IRS in April. The only thing that I have that is questionable to me is two cars. One is paid off (7 years old) and worth around $6K. The other has a loan and is worth close to what is owed on it.  Maybe a little upside down. I want to keep both.

[Horseshoez]

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@masscredit wrote:

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@Horseshoez wrote:

Congratulations on taking the next step!

I would ask lots of questions about money made in the immediate run up to filing and any windfalls you might have, be they tax returns, lottery winnings, inheritance, whatever, you might become entitled to before filing, between your hearing and discharge, and after the discharge, which the Trustee might want.  I would also ask how sure the attorney is regarding the Trustee's comfort with the filing, and what odds the US Trustee might want to get involved with an eye to a dismissal or a shove to push you toward a Chapter 13.

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I don't expect any windfalls to be coming my way in the near future unless I will Powerball. Income will remain the same or lower. I have some control over that. And I usually have to send money to the IRS in April. The only thing that I have that is questionable to me is two cars. One is paid off (7 years old) and worth around $6K. The other has a loan and is worth close to what is owed on it.  Maybe a little upside down. I want to keep both.

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That is certainly stuff you should discuss with the attorney, I don't know what Massachusetts rules are regarding exemptions and such, but the older car worth six grand may well be in jeopardy.

[masscredit]

I believe one of the exemptions (state or federal) will cover the older car. 

[masscredit]

I spoke with a BK attorney today. It looks like I'll be filing CH13 with an offered payment of $200-$250 per month for 3 years. I plan to move forward with this next month. The people who said "just do it" were right. I felt good after I left his office and that feeling continues. I have knowledge and direction that I didn't have before.  I told him I haven't taken one call and haven't opened any mail for the credit card companies.  He said it's not good to keep avoiding their calls because they can find other ways to try to get ahold of me like contacting neighbors, relatives or my work. They'll make it sound urgent but not say where they are from. Maybe I'll take some calls between now and the time I file. Courious to see what they have to say.

At this point, most of my cards have been closed. Two of the Cap1 cards charged off the other day. My EQ08 score went up 25 points when that happened. 

Mods - I know two topics were merged into one here. Can you leave my new posts seperate?  Those are looking for specific info that might get lost in this one.  Thank you!