$350K Debt on Cards. Need tips.

[ronniej]

Hello everyone,

I have around $400K in Credit cards,credit lines and department store credit limits. I owe around $360K half of the debt is on Business credit cards and credit lines. I also have 2 rental properties that I am losing $500 a month on because I cant go up any more on the rent. Now the Credit debt has incurred over the last 5 years except for 9-12 months I incurred about $125K. I tried a new business didn't work I got depressed and just started spending and depositing checks in banks and withdrawing cash and just spending. Also I was self employed before my new venture but only showed $6k on my 07 returns. I have never been late and still have a 760 credit score, but I cant keep paying everything. I have not charged anything on my cards for 9 months and have been paying the minimum payments on all of them.I have no income and am not working right now. I live in a house that is in my sisters name. I have a car that owe $14k on but worth $16k maybe.

Any tips or advise? Should I file now? Are they going to question my high debt?

[jessegirl]

Hey Ronnie and welcome. Go and talk to a few attorneys and see what your options are. Do not use any of your credit cards. Thats good that you haven't. See what the attornies say, weather you can file a 7. I wish you luck. We are filing in a few days. This is the best thing that you can do.

This is a great forum. I have received a wealth of information from alot of people here. Goodluck.

[ronniej]

Hi,

Yes I did a phone consultation with atty and he said I qualified and do not worry about it.The way I am however is I like to triple check and educate my self much as possible before making a move like that.

[Confused14]

You should definitely consult several attorney's. There are many people who have high debt, so I don't think they'll question it based on that. They usually question high debt if things don't add up or seems fishy.

I agree, this is a great forum with so many supportive and knowledgeable people! Good luck.

[TEW]

Ron
It’s only a matter of time until you slip up on one of those cards and forget a payment. Then your FICO will tank and the interest rate on all the cards will go to the MAX. like the PO are saying go get a couple of free consults from BK lawyers and see what your options are. Do some reading here there is a ton of information here.

PS my debt was about the same as your's is

[banca rotta]

Hello everyone,

I have around $400K in Credit cards,credit lines and department store credit limits. I owe around $360K half of the debt is on Business credit cards and credit lines. I also have 2 rental properties that I am losing $500 a month on because I cant go up any more on the rent. Now the Credit debt has incurred over the last 5 years except for 9-12 months I incurred about $125K. I tried a new business didn't work I got depressed and just started spending and depositing checks in banks and withdrawing cash and just spending. Also I was self employed before my new venture but only showed $6k on my 07 returns. I have never been late and still have a 760 credit score, but I cant keep paying everything. I have not charged anything on my cards for 9 months and have been paying the minimum payments on all of them.I have no income and am not working right now. I live in a house that is in my sisters name. I have a car that owe $14k on but worth $16k maybe.

Any tips or advise? Should I file now? Are they going to question my high debt?

Besides finding a good attorney you should be certain that all this money is accounted for. With this much debt especially 125k over a 9-12 month period you may need to account for where it went or at least have some sort of proof of where it went in case it becomes an issue.

IMO I think you should work on this first before you even think about filing.

[TEW]

Besides finding a good attorney you should be certain that all this money is accounted for. With this much debt especially 125k over a 9-12 month period you may need to account for where it went or at least have some sort of proof of where it went in case it becomes an issue.

IMO I think you should work on this first before you even think about filing.

Why would it become an issue?

[ronniej]

Hi Tew,

Yes I have been reading for weeks now. I have learned a lot.I think I will have no problems getting discharged.

[danaf]

yeah except what did you buy with 125k? Will your exemptions cover whatever you bought? I tend to agree with Banca here. Your debt is really high. You need to have all your stuff covered before being scrutinized by the trustee.

[ronniej]

The 125K is about 10 Months old now.This is what I did with it, please respond with your opinion.

One of my tenants left and I had to spend 15K fixing the property up. I wrote checks form my cards for about 50K and spent money from there to fix it up and to keep paying my other bills and credit cards bills. Then I took for advances of about another 75K to keep on trying to keep up and start a online business. I have about 7K a month in bills and wasn't making any income.

I purchased inventory and started selling on eBay, but was only making $500 a month profit and have about 10K inventory. I also have about 8K in the bank.

So thats the story what should I do?

[ronniej]

Also I forgot to mention. I really lived above my means the past 6 years. I partied a lot almost got married I lost 30K on that alone.

Very poor money management.That's it. I messed up I need a fresh start.

Till now I pay every payment about 35 monthly bills and never been late on any still have a high credit score.

[JRScott]

When did you take the advances, this might could be considered income?

The house you live in, has it ever been in your name?

[banca rotta]

The 125K is about 10 Months old now.This is what I did with it, please respond with your opinion.

One of my tenants left and I had to spend 15K fixing the property up. I wrote checks form my cards for about 50K and spent money from there to fix it up and to keep paying my other bills and credit cards bills. Then I took for advances of about another 75K to keep on trying to keep up and start a online business. I have about 7K a month in bills and wasn't making any income.

I purchased inventory and started selling on eBay, but was only making $500 a month profit and have about 10K inventory. I also have about 8K in the bank.

So thats the story what should I do?

You originaly stated that you "were withdrawing cash and just spending it". If you took a lot of cash out of the bank and were spending it you may need proof. of exactly what it was spent on.

A few hundred a year ago may not matter. If you withdrew several thousand even a year or 2 ago and the US Trustee happens to ask for a few years of documentation you will have to explain it. It may or may not happen but you need to be able to explain it if it does.

Keep searching this forum and you will see some posters that lost thousands in gambling and couldn't explain to the trustee where it went.

[ronniej]

The house I live in is in my sisters name and it has never been in my name.

I pay everything little bill for it though.

So basically if you lost money gambling and just spent cash a lot of places and there is no way of proving it your out of luck and you don't get a fresh start?

Is this correct?

[danaf]

Well - start by finding out what your state exemptions are, by doing the means test ect. And start collecting all your documentation for where that money went. Some trustees ask for cc statements, others don't. I would wait until at least a year out from your last charge or longer if you can.