On the Edge

[aj2009]

I have a total of 15 collections accounts 4 of which are credit cards that are accuring interest. The highest balance is 1225 for Cap one. At this point my fico is 515. I make only 27K a year. I need advice would anyone recommend me going through with a bk? I am 24, I have no true assets I rent my apartment I have a car that is paid for worth maybe 3000.00 blue book value. Any suggestions or ideas would be appreciated. I just want a fresh start not being harrased by collection agencies and getting a ton of collection mail. I think I may owe 10k total not a lot I know but i do have a child that i am sole provider for. My parents say don't do it. I would just like someone that has been in my shoes to help me weigh my options.

[HHM]

First, what are the other 11 accounts that are in collection? And what is your total debt?

[aj2009]

the other 11 accounts are 1 medical debts, 3 personal loans, the rest utilites I believe some I am not for sure on because it just list the collection company and not the original creditor. My total debt is 10k I believe

[slam22]

the other 11 accounts are 1 medical debts, 3 personal loans, the rest utilites I believe some I am not for sure on because it just list the collection company and not the original creditor. My total debt is 10k I believe

I would not advise you to file BK for just 10K. Make yourself a budget, stick to it and you can have that paid off in less than two years, your FICO score will improve dramatically and you'll be debt free.

[aj2009]

Thanks I had been doing a lot of research and was unsure of how to go about tackling this debt I think I will try the debt snowball that I have read about I was just worried in the process of paying these debts that cap one my try to sue me they recently started calling agian and it is now with an attorney's office, and the last thing I wanted was a judgement on my credit report as if it isn't bad enough.
but thanks for your help

[keepmine]

$10K isn't enough to file bk over. Your biggest problem isn't debt but, lack of income.
You need to start looking for a better job or, a pt/weekend job. Prehaps your parents can look after your child while you work some additional hours or let you move ack home for 6 months or so while you get back on your feet.
How long have these cc accounts been in default?

[HHM]

Although objectively $10K doesn't seem like that much debt, it is 37% of your gross annual salary.

1. You need to do a budget, you need to figure out where your money is going and how to live on the money your earn.

2. BK is a viable option. If the accounts are all in collection, this has been going on for some time. A BK will get you a fresh start.

3. As for future credit, I think BK is the better option. It will stop the accruing of negative entries. I have to disagree with Slam on this one, since the accounts are in collection, they don't report things like payment history and what not. The only time the entry changes is once the debt is paid off. This persons credit would recover more quickly with a BK. Also, given this persons stated income, a 2 year plan is unrealistic, even without accumulating interest, the payment would be $416 per month. Plus, it assumes the collections agencies would even accept it, which they probably wont.

[Reddrocket07]

i agree with keep or quit your job, but id see if you could lighten your financial burden by moving back home or finding a roomate.

[AngelinaCat]

Where is the child's other parent? Are you getting any kind of child support? I also agree that you probably need to move back home if you can.

My best~~~

[HHM]

You posted duplicate threads, so I merged them into one.

[aj2009]

At this point after bills i have about 300 per month I did so serious thinking over the weekend created a budget I listed all my debts so far it would take me all of 2009 to pay off each credit in full. If I choose to pay everything off in collections will this help for future credit or is a bk better for future credit?

[keepmine]

If you can avoid bk, do it. While many of us here have come out the other side of bk in good shape-I think all of us would prefer to go through life without the bk on our record.
Paying old collections won't help your score in the nearterm but, like anything else-as more time passes, the less affect these things have on your score.