Would this work...interesting....

[flower04]

HI all-

I'm just bouncing off this idea to see what you know about this. We are set to file in about 7 weeks....waiting for a payment to be over 90 days past. My DH and I were talking and we realize that our once $140K cc/medical bill debt can now be negotiated for pennies on teh dollar. A family member recently inherited a LARGE sum of money and they would be willing to pay off our neogotiated debt, depening on price. As great as this sounds, we are still going for a 13 because we don't want to be "in debt" to this family member. However, it is something interesting to think about. any thoughts?

[lrprn]

Could it work? Sure. However, only you can decide if you would rather owe the money to your relative or to the trustee and court. Each has their advantages and disadvantages.

Calculate how much you would have to pay the relative each month to repay the loan against how much a monthly Ch 13 payment would be. Also weigh how much filing would impact your future family financial plans vs. paying back your relative over the specified time. One last thing to consider - how will things work out inside your family if something happens (big medical bills, job loss, etc) and you aren't able to pay back your relative.

[HHM]

Unless you have an actual offer from the creditor for "pennies on the dollar", then you don't really know this. If you are thinking of going with one of these debt settlement companies, beware.

Despite all these claims of "pennies on the dollar" the average settlement is between 55-65% of the balance, assuming you can get a settlement.

BK will put you in control of the situation. That control is usually more beneficial than any empty promise by a debt settlement firm that "might" be able to negotiate a settlement.

Do this on your own, do not involve you relatives. Do your BK and if your relative wants to give you money, then put that money toward retirement.

[BROKENN]

When I was young, I did a debt negotiation. Killed my credit for over 7 years as the companies kept re-posting. Bk rips the band-aid off immediately IMHO

[nchpycampr]

Our situation was similar in that we had a family member that we could have gone to get the money to pay off our debts. We chose not to because we decided that taking personal responsibility for our situation was the first step in learning to live within our means.

We also did not want the family member to later need the money for nursing home care or other needs and have it tied up with us.

Each person has to look at their own situation.

[flower04]

Yes, I agree with most of you. I don't really want to get this family member invovled. Part of why we are in this situation is to learn from our mistakes. We should have had $ saved up so when I was unable to work becuase of medical reasons, we would be OK. Instead we used cc's and the rest is history. Live and Learn.

What I don't want to do is not have this over with one way or the other in the next 4-6 months. By "over with" I mean, started on a payment plan with an end in sight. Our credit is shot anyway no matter what we decide.

Thanks for your reponses. Always good to get a consensus.