Would you..?

[mankind]

Hello everyone. I really need some advice on what I should do. Here is my situation. I currently have approx. $17,500 in cc debt. All the cards range from mid teens to twenty-five percent interest. I have been paying the min. payment for a few years and have made zero progress.

While trying to keep current and pay everyday expenses I ran up a card on which I am an authorized user in the amount of $12,000.00 that I will have to pay no matter if I file or not.

I can't keep up with the payments anymore but it almost seems like its not worth it to file only to eliminate the $17,500 but it seems insurmountable to me. Ideally I'd like to lower my payments and greatly reduce the interest but I know alot of cards won't even work with you before you are overdue for a few months.

I currently rent and only have one used car that could go kaput at anytime. Even if I got a second job I'd only be treading water.

What would you all do?

[HHM]

Why do you have to pay the "authorized user card" whether or not you file?

Generally speaking, $17,500 is a relatively low amount of debt to file on, but it all depends on your circumstances. You may want to try consumer credit counseling and see what kind of payment they give you.

[mankind]

Why do you have to pay the "authorized user card" whether or not you file?

Generally speaking, $17,500 is a relatively low amount of debt to file on, but it all depends on your circumstances. You may want to try consumer credit counseling and see what kind of payment they give you.

I have to pay the other card because my mother let me use the card to help me and she can't afford to take over the payments, $230 min/month. She called them to ask for a lower interest rate and they saud her debt load was too high.

I can't just stop paying on it and hurt her credit and have them hounding her.

I know $17,500 seems like a somewhat low amount but in conjunction with the other ($12,000) debt its overwhelming me.

I am going to call my cc and see if they will lower my interest cause I'm about 1 month away from falling behind.

I just don't want to fall behind. I know they will start tacking on late fees, overlimit fees and soon the debt will be much larger and my credit will be wrecked.

[mankind]

In regards to the credit counseling, I've heard alot of bad things about them not making payments on time and it hurting your credit.

Even if the interest was 0%, $30,000 is a lot of debt especially when I'm only making about $24,000/year.

I've gotten myself into quite the mess.

[Lightning]

You can't file for bankruptcy and then decide to only pay on that one card. A Chapter 7 wipes out everything, and your mother will be held liable for the balance. If you have the money to pay it after filing, the trustee will probably investigate you. If you file a Chapter 13, all creditors will be treated equally including your mother's card. You can give her money, but you'll have to either inflate your expenses to make up for it or spend less than your budget allotments in various categories so you have that extra money.

Since the amount you owe on your mother's account is nearly 70% of your debt, I really don't see a way for you to file bankruptcy and not stick your mother with the bill.

[mankind]

You can't file for bankruptcy and then decide to only pay on that one card. A Chapter 7 wipes out everything, and your mother will be held liable for the balance. If you have the money to pay it after filing, the trustee will probably investigate you. If you file a Chapter 13, all creditors will be treated equally including your mother's card. You can give her money, but you'll have to either inflate your expenses to make up for it or spend less than your budget allotments in various categories so you have that extra money.

Since the amount you owe on your mother's account is nearly 70% of your debt, I really don't see a way for you to file bankruptcy and not stick your mother with the bill.

Edit: I think you are getting the two amounts mixed up. The debt on my mothers card is approx. 40% of my debt.


How would how I file have any effect on my mother's card as I am only an AU? If I filed Ch7 or CH 13 I wouldn't be able to include my mother's card.

I thought that when you filed for bk7 you used expenses that you were reasonably allowed or expected to have if you weren't living like a pauper and living off ramen.

Even eliminating the payment on my mothers card I am still negetaive as far as income to expenses. That is if I'm actually including expenses that I should reasonably have if I wasn't cutting alot of corners, i.e. no health care/doctors visits, dental, clothing, delaying car repairs-new tires, etc.

I could probably reasonably be allowed $50-$75/month for clothing. However since I have been cutting back I've spent only about $200 for clothes and shoes in 2 years and that was for work attire not casual.

[herekitty]

Depends on where you live dear. In WI an AU is just like a co-signer - you are responsible for 50% of debt regardless if you spent it or not. That's how my ex screwed me in funds. Check your credit report - go to annualreport.com and pull all three (you'll need them anyway) - see if its listed on your report.

Most lawyers will give a free consultation, you should look into seeing a couple to get their advice.

I haven't heard many positives about debt consolidation - I looked into it, they wanted $1K down before even talking.

Yes bankruptcy takes into account income and reasonable expenses, if you're making under $100 after taking away the unsecured debt and adding up normal monthly expenses than it's a good sign you should seek chapter 7. Chapter 13 is sort of like consolidation - sets you up on a repayment plan for a certain amount of years (I don't know alot about this though - check out the CH 13 forum). You need to look into this ASAP, the new law depends on your income and the median in your state and there's also alot of little previsions having to do with evictions, etc.

[mankind]

Depends on where you live dear. In WI an AU is just like a co-signer - you are responsible for 50% of debt regardless if you spent it or not. That's how my ex screwed me in funds. Check your credit report - go to annualreport.com and pull all three (you'll need them anyway) - see if its listed on your report.

Most lawyers will give a free consultation, you should look into seeing a couple to get their advice.

I haven't heard many positives about debt consolidation - I looked into it, they wanted $1K down before even talking.

Yes bankruptcy takes into account income and reasonable expenses, if you're making under $100 after taking away the unsecured debt and adding up normal monthly expenses than it's a good sign you should seek chapter 7. Chapter 13 is sort of like consolidation - sets you up on a repayment plan for a certain amount of years (I don't know alot about this though - check out the CH 13 forum). You need to look into this ASAP, the new law depends on your income and the median in your state and there's also alot of little previsions having to do with evictions, etc.

Thanks for the advice. I have two consultations scheduled in the next week and a half. I may call a third lawyer as well. I will have to pull my credit reports for sure.

I live in PA and I'm not sure what the law is in regards to AU. I was under the assumption that being an AU you were allowed to use the card but weren't a co-signer or responsible.

This may prove problematic as I was planning on filing by myself but my wife is an AU on a couple of my cards.

Thanks again for the info.

[edwards2]

Let me see if I understand this. It is your mother's card but you were authorized to sign on it and you cant include it if you filed BK because the card is in her name because you are just an authorized user. Okay if that is right then you want to file on the remaining debt you have? We filed on over $85k but I have seen posts who have filed on a lot less. I would not go the credit counseling route simply because from what I have heard they are slow to pay your creditors, if at all, and you end up paying until they supposedly get your interest rate lowered and you are paying them some upfront fee. However, some people who have gone that route have said if you find one that is a non-profit, which is what you should look for anyway, you wont be paying them a fee - only a donation. I think consulting an attorney would be your best route.

[mankind]

Let me see if I understand this. It is your mother's card but you were authorized to sign on it and you cant include it if you filed BK because the card is in her name because you are just an authorized user. Okay if that is right then you want to file on the remaining debt you have? We filed on over $85k but I have seen posts who have filed on a lot less. I would not go the credit counseling route simply because from what I have heard they are slow to pay your creditors, if at all, and you end up paying until they supposedly get your interest rate lowered and you are paying them some upfront fee. However, some people who have gone that route have said if you find one that is a non-profit, which is what you should look for anyway, you wont be paying them a fee - only a donation. I think consulting an attorney would be your best route.

Yes you are correct in describing my situation.

Instead of filing a couple years ago I foolishly used my mother's card hoping that with my education I would find better employment and could pay it all off in the near future. Well the dream job never materialized and I just now got a new job with more advancement potential but with higher living expenses in a new city.

[Lightning]

From your original post, you have $17,500 in credit card debt.
You ran up $12,000 on your mother's card.
Does that mean you have a total of $29,500 in credit card debt?
If that's the case, then the money on your mother's card is 40% of your total debt.

If you're only an authorized user, then depending on the state you live in, you don't even have to list this debt when you file. Of course that means you're swearing in court that you don't owe the money, and then your mother is liable for the total balance. If you pay anything on it, then you've committed perjury. You can't tell the court you don't have the debt and then turn around and pay on it.

If you list it as a debt, then you either pay on it through a Chapter 13 plan with the same consideration as your other creditors, or it's dismissed in a Chapter 7, and your mother is stuck with the whole balance.

[mankind]

From your original post, you have $17,500 in credit card debt.
You ran up $12,000 on your mother's card.
Does that mean you have a total of $29,500 in credit card debt?
If that's the case, then the money on your mother's card is 40% of your total debt.

If you're only an authorized user, then depending on the state you live in, you don't even have to list this debt when you file. Of course that means you're swearing in court that you don't owe the money, and then your mother is liable for the total balance. If you pay anything on it, then you've committed perjury. You can't tell the court you don't have the debt and then turn around and pay on it.

If you list it as a debt, then you either pay on it through a Chapter 13 plan with the same consideration as your other creditors, or it's dismissed in a Chapter 7, and your mother is stuck with the whole balance.

Lighting I wasn't aware of that. I've been mostly looking into Ch7 but if I could include everything in a CH 13 it might be more beneficial. I'll start reading up on the Ch 13.

So are you saying I could include my mothers card in my Ch13 bk and pay them under the plan like my other creditors and they won't try to get money from my mother? Or could they still try to collect from her as well?

[HHM]

There are reputable Consumer Credit Counseling agencies, (CCC is different than debt consildation, stay away from debt consolidatin). Most CCC's put you on a 3 to 5 year payment plan to pay off the balance of your credit cards and typically stop interest from accrueing.

Given your debt load, I think BK is too extreme a solution.

[Afr0dite]

There are reputable Consumer Credit Counseling agencies, (CCC is different than debt consildation, stay away from debt consolidatin). Most CCC's put you on a 3 to 5 year payment plan to pay off the balance of your credit cards and typically stop interest from accrueing.

HHM, please give me a list of reputable Consumer Credit Counseling agencies.
Thanks.

[mankind]

Well I just went to see a lawyer today at one of the more well known firms in the area and learned almost nothing that I didn't already know.

My two biggest concerns were/are a bk7 affecting my employment as I am in a 1 yr long manager trainee position in the state governement. Management employees are not covered by the union and are probably much easier terminated than others.

He said that he has done bk for civil servants before and it never caused them a problem. I told him I was classified as managerial employee and his eyes seemed to glaze over.

My second concern was the $12,000 debt I referenced in previous posts which I incurred on my mothers cc as an au trying to stay current with my other debtors.

He said that it wasn't legally my debt and I could continue to pay it or give my mother money to pay it as long as it wasn't icluded in my expenses and I was negative or close without it.

I am going to see another attorney next Thursday so we'll see how it goes.

Any comments anyone?