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Struggling to pay bills, but still have decent credit however i need to file chapter 7

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Established Member

Struggling to pay bills, but still have decent credit however i need to file chapter 7

I have a fairly decent credit score of 648 down a bit from right at 800 due to being too heavy on debt to credit line (basically the cards are maxed out)
We are struggling to pay our bills and it is embarrassing but i think we will have to file chapter 7 bankruptcy as we have tried nearly everything to get back on top of this debt and nothing has worked.

are there any guidelines we should follow to get the maximum out of filing? I have never missed a payment, and am actually current on everything but the problem is being current on everything means cutting out EVERYTHING a normal person or family SHOULD have like normal food and not sandwiches and ramen noodles lol , putting fuel in vehicles, and just an all around depressed mood in the entire household that is driving us insane. 

should we continue to stay current on the cards or just let them go being as we plan to file within 2 weeks? I researched all this years ago but cant remember much any help with guiding us through this situation is greatly appreciated. 

of course we have spoke to a few attorneys but we didnt get this type of info from them we just got the basics of how a chapter 7 works these days.

thanks!

Message 1 of 17
16 REPLIES 16
Community Leader
Valued Contributor

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

Have you hired an attorney or just consulted?  Yes they say your credit looks better if you have no lates prior to the BK, but if you guys are struggling that much sometimes worrying about your scores should take a backseat.  What are your minimum payments each month? Do you have the money to obtain the lawyer and file? If you can hire and file within 30 days, I would stop paying them use that money for the lawyer and your family's needs. 

Message 2 of 17
Established Member

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

just consulted so far, but we have our eye on an attorney that seems right for us. We do have access to the money to hire her from a family member as much as i HATE to do that. 

Our minimum payments? lets just say between the minimum payments on credit cards and our other bills i have no clue how weve made it this far! the minimums on the cards and our other bills total at least twice if not triple what we have for income per month. I only say this because i have lost the detailed budget somehow that i wrote out last month, but will be looking for it or making a new one however cumbersome it is because it was extremely detailed.

im just trying to make this as painless as possible because i know how hard one has to work to rebuild credit after they are down bankruptcy or not. 

thank you for your reply jnbmom!

Message 3 of 17
Frequent Contributor

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

It sounds like your spending got the best of you, but you are otherwise employed and nothing tragic has happened.  You should consult with an attorney (most bankruptcy attornies will consult with you for free) and complete a means test for your income versus requirements for a successful chapter 7 filing.  You don't mention income, but it's an important facet for qualifying for Chapter 7.  

 

Regardless, good luck to you.




Message 4 of 17
Contributor

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

I had similar concerns when i filed Ch 7 a llittle over a month ago.  All 6 attorneys that i met with said to stop paying....but, after explaining to them why i wanted to stay current, they then said it was up to me.  Just don't pay any extra to creditors, and don't choose some creditors over others when it comes to making payments.  You want to avoid 'preferential payments'.

 

Out of about 35 open CC accts, unsecured loans and secured loans....I did get (5) 30 day lates.  It would have been only (2) 30 day lates but my filing was postponed 2 wks.

 

Keep in mind,  a payment to a creditor won't be 30 days late until 30 days after a statement cuts.  So try to file within 30 days of missing a payment(s).  It wil be 'tricky' since im sure your statement cut dates vary with each creditor.

 

Hope that helps.

Message 5 of 17
New Contributor

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

If it makes you feel better, my spouse is already at 670s on 2 out of 3 credit bureaus not even 6 months past discharge. We did keep paying minimums, but only minimums, until we filed. I don't know that it actually makes that much difference, each of the accounts will show up negative anyways if included in bankruptcy, but that was how we did it. 

Starting Score: EQ 595, TU 538, EX 577
Current Score: EQ 642, TU 604, EX 641
Goal Score: 700


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Chapter 7 discharged 2/20/19
Message 6 of 17
Member

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

Thanks that is my game plan too keep everything current and hope it helps me build quicker so I can buy a house in the future.
Message 7 of 17
Moderator Emeritus

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

Stay current and of course avoid filing if you can. But do not be ashamed if you have to file. Also, paying right up to filing does you no good as all payment history and balances will be wiped away anyway after you file. 

Message 8 of 17
Established Member

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7

why do you say stay current, but then say everything will be wiped anyway?


@Tuscani wrote:

Stay current and of course avoid filing if you can. But do not be ashamed if you have to file. Also, paying right up to filing does you no good as all payment history and balances will be wiped away anyway after you file. 


 

Message 9 of 17
Contributor

Re: Struggling to pay bills, but still have decent credit however i need to file chapter 7


@Underconstruction wrote:

why do you say stay current, but then say everything will be wiped anyway?


@Tuscani wrote:

Stay current and of course avoid filing if you can. But do not be ashamed if you have to file. Also, paying right up to filing does you no good as all payment history and balances will be wiped away anyway after you file. 


I'm with you underconstruction as to what Tuscani says and it not registering with me either.  What Tuscani says may be true, but, if you miss payments and are 30 days late prior to filing, then those 30 day lates will stay on your credit reports for 7 yrs, regardless of the BK,  and your reports will not be wiped clean of those derogatory accts.

 

 

Message 10 of 17
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