Bankruptcy & Garnishments Questions

[Anonymous]

My husband and I make a combined total of $5000/mo. Our total bills equal $4600/mo. This does NOT include food and gas. Since my husband has perfect credit, I figured that I would stop paying my bills (except for my car), and just use that extra income to pay off his for the next 6 months to a year. My ultimate goal is to be a stay-at-home mom (I have a 9 month old now). I am willing to sacrifice my credit for 7 years. I'm not considering bankruptcy really because first off, the fees for the lawyer, and second, because with the new laws, you have to prove that you cannot afford payments even with a credit counseling service (which I'm sure we could) - from my understanding. I'm wondering, how would the garnishments work if it came to that, how long would it be before it happened, and would I be fired if my employer found out?

[Anonymous]

How much debt do you have?

[fishbjc]

What happens if your husband & you get divorced?  Where will you be then? 

Call EACH of your creditors.  Explain the situation and ask to be entered into their hardship program.  I recently helped a friend & it went like this:

LOWE'S.....Lowered her to 0% interest, closed the account, payment plan over 5 years. 

HFC....Lowered her to 6% interest, closed the account, payment plan over 5 years.  (Saving her $83.50/month)

Sounds like you need a finance plan.  You can try CCS and make good on the debts that you signed for.

[californiajeff]

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@Anonymous wrote:
My husband and I make a combined total of $5000/mo. Our total bills equal $4600/mo. This does NOT include food and gas. Since my husband has perfect credit, I figured that I would stop paying my bills (except for my car), and just use that extra income to pay off his for the next 6 months to a year. My ultimate goal is to be a stay-at-home mom (I have a 9 month old now). I am willing to sacrifice my credit for 7 years. I'm not considering bankruptcy really because first off, the fees for the lawyer, and second, because with the new laws, you have to prove that you cannot afford payments even with a credit counseling service (which I'm sure we could) - from my understanding. I'm wondering, how would the garnishments work if it came to that, how long would it be before it happened, and would I be fired if my employer found out?

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Bankruptcy is a very viable option. Whether or not it makes sense for you all depends on your situation. How much do you owe? You should be able to find an attorney that can do Chapter 7 bankruptcy for around $1300. It could make a lot of sense after you are out of work and have a lower income but it depends on how much you owe. Bankruptcy does not kill your credit for 7 years. You will be eligible to get an FHA loan for a house in 2 years (or 3 years if you let one go back to the bank during bankruptcy).

[haulingthescoreup]

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armywifemish wrote:
My husband and I make a combined total of $5000/mo. Our total bills equal $4600/mo. This does NOT include food and gas. Since my husband has perfect credit, I figured that I would stop paying my bills (except for my car), and just use that extra income to pay off his for the next 6 months to a year. My ultimate goal is to be a stay-at-home mom (I have a 9 month old now). I am willing to sacrifice my credit for 7 years. I'm not considering bankruptcy really because first off, the fees for the lawyer, and second, because with the new laws, you have to prove that you cannot afford payments even with a credit counseling service (which I'm sure we could) - from my understanding. I'm wondering, how would the garnishments work if it came to that, how long would it be before it happened, and would I be fired if my employer found out?

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Uhh... Does the fact that you are proposing to not honor your obligations, at least for a while, enter into this at all? You can afford to pay your bills, but you just aren't going to?

If I've missed something here, I apologize. But please do realize that these forums aren't like other credit forums, where pretty much anything goes. Here we help another dig out of holes, while still trying to do the right thing.

As fishjbc said, call your creditors, and see what you can work out. Two people and a baby should be able to do food and gas on $400 a month, with scrambling.

And if your husband is active duty, this might blow up on him as well, I don't know. I know that my uncle got called on the carpet many years ago for my aunt's string of bounced checks, a deeply humiliating moment for him. Things might have changed, though.

Kudos to you for wanting to stay home with your baby. I was fortunate enough to be able to do so with my three for a long time. And one thing that was important enough to make me do this was because I wanted to make sure that my kids were going to learn my values.

A post I read elsewhere on the forums: I hope this doesn't sound rude, but if you have a balance on a bill and you know you owe them, well....

Sorry if this sounds harsh, but we do tough love here. Tough + love.

[Anonymous]

Speaking from experience, you do not want to do this. 

If you sacrifice your credit you will be sacrificing your spouses career.

I lost my clearance for 1 1/2 years while cleaning up my credit.  My commander finally put closure on the past.

My bad credit was not something I did on purpose, there were several contributing factors.

But, when it came to fixing my credit or getting kicked out of the military, I chose the former.  My income is a lot less than your combined.  I found a way to stay current on all of my bills plus pay off some old debt.  It was not easy and we did without a lot of creature comforts.

[Anonymous]

I will absolutely promise you that the last thing that you want ruining your day is calls and threats from CAs, JUDGMENTS that will not go away in 7 years & will be patiently persistent enough to renew for *another* 10 years (waiting for you to get a job or a bank account with your name on it, because the debt is now 2, 3, or 5 times what you originally owed), garnishments, embarrassing calls to your & your husband's place of employment, family members & neighbors, and being turned down when and if you ever actually NEED credit. Higher insurance premiums, having your personal check denied by a grocery store, are other considerations. And higher stress levels will quickly put a damper on your happy home.

And, eventually, you'll want to re-establish yourself & your credit standing. Nobody who truly understands the road that has to be taken would willingly choose repairing and rebuilding if they have the opportunity to avoid it. It's not fun to find out that you're blacklisted. It's not fun to find out what a zombie collection is, and how it will come out of the woodwork at the most inoportune moment of your life to ruin your chances of financing. You really won't want to have to grovel at the feet of any corporate executive whose email or mailing address you can find, begging them to just please delete a trade line, or to understand what your dire situation was and grant you forgiveness in the form of removing the bads... only to be told "NO!"

It's not worth it. You won't just fade into the woodwork for 7 years, and come out in a patch of roses on the other side. It will be a very long and disproportionately painful trip that you'll have financed at too high of a price with your reputation, your peace of mind, and untold amounts of money that you thought you'd avoid paying in the first place . Please don't do it.

In addition to talking to your current creditors about hardship programs, and debt managment companies as suggested by previous posters (please give strong consideration to their advice), you might want to consider deferring your more immediate plans of staying home & getting another job to pay off debt faster. Consider it one of the (many) sacrifices that you're making for your family, in the short-term, to have a more comfortable, prosperous, and secure long-term. And, consider cutting your expenses, and selling whatever items that you can do without to help pay down the debt faster, so that you can move into your intermediate career of full-time homemaker without the spectre of debt waiting to come crashing down on you.

Good luck! I have children too, my youngest a baby just a couple months younger than yours, so I know what it means to be able to spend more quality time with them, and caring for your family. I just want that time to be enjoyable for you, and not an anxious time in your life, frought with worry, turmoil & undue hardship.

Much luck to you!

[medicgrrl]

You really don't want to do this!  You don't know what your future holds.  You may need your good credit sooner than you expect.

To just blow off your debts to be a stay at home mom is not the responsible thing to do.  I'm sorry to sound harsh but there are many of us on here that have had to rebuild because of unfortunate circumstances that were beyond our control.  It is not an easy process and like the other poster stated, can be quite humiliating!  If you want to take control of your finances to become a SAHM then do it the right way, cut back on other expenses, cancel the cable, quit eating out, cut back on the utility bills, clip more coupons,etc.  There are many ways that you can improve your financial situation in the next 6-12 months without defaulting on all of your debts. 

I would suggest being more specific on your post with regards to your obligations and then asking for suggestions on how to improve your situation the right way.  I am a low-moderate income single mom digging my way out.  There are ways to do it and even ways to do it on one income that don't involve what you are suggesting.  Sorry but, I don't think anyone here will advocate what you are wanting to do for no other reason then you want to quit your job.

[Anonymous]

Instead of blowing off your debts, why not pick up a part time job and throw that money towards all the debts combined? I know it's going to be hard with a baby, but your goal is the important thing - and how you obtain the goal will define your character.

[ECHOBOI4U]

Do what you can to avoid bankruptcy as they have mentioned.  Take it from me.  Mine is falling off Nov this year (2009).  It has been hell since getting back on track....BUT....if you get garnished and it is way over your head (you are trying hard, but getting hardly anywhere), do it.  But only as a last resort.  BK stops garnishment and the companies have to repay the money back to you by law (they did to me from my 10 year BK).  Best of luck and best wishes to you and your family.