@John00 wrote:Hi everyone!
I am self employed and my business got killed during the COVID years and ultimately had to shut down the business. In between starting a brand new business and shutting down the old one, I accumulated about $50,000 in credit card debit. It's starting to take a toll on my stress as I have $2,000 of minimum payments each month. I'm not late on any of the cards but it's very difficult to pay down the balances.
I want to buy a house in the next few years and my debt to income ratio is making this quite difficult.
What is the best plan to move forward? If I can't pay down these cards in a significant way, does it make sense defaulting on them or filing for bankruptcy to "reset"? What is the fastest way to recover from this situation to move forward with life and start planning on buying a house?
Thank you in advance for your help and suggestions!
In your shoes (I've actually been there), I would open a credit union account and explore the possibility of obtaining a loan to cover the credit card debt at a lower interest rate. Depending upon your cash flow, this could either be a long shot or reasonably easy.
Failing that, you could call your credit card companies and plead hardship and see if they can knock down the interest rates and freeze your cards until you get them paid off.
Then there is the nuclear option of bankruptcy (been there too, not fun, but survivable).
