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13? 7? Not at all?

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    13? 7? Not at all?

    Hello all,

    Great site. I've been reading it quite a bit today and it's very informative. That said, I'm still fairly ignorant on BK. I'm seriously considering it as I have come to the conclusion that I will have to be a two-job-working hermit for the next 5 years to get myself back in decent financial shape(I'm 30 btw). My situation now is this: $30K annual income, $7K student loans, $5K auto loan and the biggie $41K cc. More than half my monthly income goes to cc mininums alone. I was an extreme example of the college kid who gets several cc's after being in a dorm for just a couple months and just assumed paying them off would never be a problem. After getting a better job after college, my charging didn't slow down (gas, groceries? sure why not. That's not much) Without providing my full budget right now, I can say that I'm $250 in the red each month currently. I'm in a rent free situation even (parents old, death trap house they own) but I pay utilities. I'm current on all bills right now but the darkness is looming. In two or three months I will be in really bad shape. I have recent cc activity (groceries, gas mainly but a couple of "frivolous" buys).

    Questions: Am I a BK candidate? 13 or 7? I need to keep my car, laptop, not much else really. How much will the rent-free situation likely affect my filing? When should I file? Any other thoughts, suggestions would be greatly appreciated. Thanks!

    #2
    Hi,

    Based on the information you provided, a Chp 7 would be ideal for you. You'll be able to wipe out all your credit card debt. But you student loans will remain, but you can always renegotiate a better repayment plan if needed.
    All of the other personal items you own, is more than likely exempt.

    Good Luck!
    The information provided is not, and should not be considered legal advice. All information provided is only informational and should be verified by a law practioner whenever possible. When confronted with legal issues contact an experienced attorney in your state who specializes in the area of law most directly called into question by your particular situation.

    Comment


      #3
      Thanks for the quick, quality response. I keep thinking that 13 is they way I would have to go but I should be able to keep my car and other essentials with chapter 7? Maybe I'm missing the obvious but since I'm in a position where I could pay my debts if they were, say, half of what they are now, doesn't that mean I would have to go 13? Again, I'm not very knowedgable at this point. If I elect for Ch 7 do you think I'll need to wait to let the situation escalate and also get more distance from my last cc purchases? I'll obviously begin the process of interviewing attorneys to find one that will work well with me and can enlighten me on Missouri specifics.

      Comment


        #4
        Also, since the house I live in (but don't own) is pretty much in a state that it should be condemned, moving into an apartment is a priority. Would it be wise to get an apartment before or after BK.

        Comment


          #5
          when to get an apartment, before or after BK?

          Originally posted by owen13
          Also, since the house I live in (but don't own) is pretty much in a state that it should be condemned, moving into an apartment is a priority. Would it be wise to get an apartment before or after BK.
          I think getting a new apartment would be easier before filing . . . your credit probably still looks fine. I think Dawn1970 posted something about getting an apartment for herself and her daughter . . . check her posting. I can't remember if she did it before or after. But she got one. Good luck with all of this. I agree w/ Todd that Ch. 7 makes the most sense.

          Comment


            #6
            Originally posted by owen13
            Thanks for the quick, quality response. I keep thinking that 13 is they way I would have to go but I should be able to keep my car and other essentials with chapter 7? Maybe I'm missing the obvious but since I'm in a position where I could pay my debts if they were, say, half of what they are now, doesn't that mean I would have to go 13? Again, I'm not very knowedgable at this point. If I elect for Ch 7 do you think I'll need to wait to let the situation escalate and also get more distance from my last cc purchases? I'll obviously begin the process of interviewing attorneys to find one that will work well with me and can enlighten me on Missouri specifics.
            Hi,

            Do you think you can payoff your credit card debts in five years? Are you willing to take get a higher paying, and or even a part-time job to pay off your credit card debts? If you willing to do this, then you could even avoid a Chp 13 and just work directly with your creditors, to arrangement a mutually acceptable repayment plan. Doing so would avoid getting your credit gigged with a BK mark.

            Your current living arrangement, could enable you to repay your debts without resorting to BK. And if you can fully commit/discipline yourself towards repaying your credit card debts aggressively, and not using anymore credit for discretionary purposes, then you could go at it alone, and avoid BK entirely. There's going to be a compromise, regardless of the option you elect.

            Good Luck!
            The information provided is not, and should not be considered legal advice. All information provided is only informational and should be verified by a law practioner whenever possible. When confronted with legal issues contact an experienced attorney in your state who specializes in the area of law most directly called into question by your particular situation.

            Comment


              #7
              Originally posted by Todd
              Hi,

              Do you think you can payoff your credit card debts in five years? Are you willing to take get a higher paying, and or even a part-time job to pay off your credit card debts? If you willing to do this, then you could even avoid a Chp 13 and just work directly with your creditors, to arrangement a mutually acceptable repayment plan. Doing so would avoid getting your credit gigged with a BK mark.

              Your current living arrangement, could enable you to repay your debts without resorting to BK. And if you can fully commit/discipline yourself towards repaying your credit card debts aggressively, and not using anymore credit for discretionary purposes, then you could go at it alone, and avoid BK entirely. There's going to be a compromise, regardless of the option you elect.

              Good Luck!
              I could theoretically get a 2nd job and possibly pay off the debt (or enough of it) within 5 years. However, factor in that I really do NEED to move out of the house I'm living in because it really isn't liveable and therefore factor in rent, and my financial situation will be highly stressful combined with the stress of two jobs for a long time. So, while I consider BK a last resort, I have to be realistic and wonder if it would be worth it to instead file a BK and live with bad credit for a few years but not have financial stress. I especially wonder that when I read articles that say while officially a BK is on your report for up to 10 years, it is effectively a non-factor much sooner and you can theoretically have decent credit within a couple or few years of being discharged. If in fact I am able to discharge my CC debt and the BK really won't be as bad as most think then I can't help but think that may be the better, less stressful choice. I keep coming back to, yeah, if I do this and that I could eventually pay off the debt but is it worth it to live terribly for such a long time? I guess that's where I'm at. I feel like for me I would be better served to have a clean slate, albeit with a big black mark for awhile. Anyway, thanks for listening and any thoughts are very welcome. I've talked myself into at least talking to a lawyer or three to get more details. To dream of a new beginning... lol
              Last edited by owen13; 03-01-2005, 05:38 PM.

              Comment


                #8
                Your DTI is already in bad shape, and once you add rent to the equation you're in worse shape. Hence, Chp 7 would probably be your most logical choice...........toward establishing a "fresh" start just as any attorney you speak to would recommend.

                Good Luck!
                The information provided is not, and should not be considered legal advice. All information provided is only informational and should be verified by a law practioner whenever possible. When confronted with legal issues contact an experienced attorney in your state who specializes in the area of law most directly called into question by your particular situation.

                Comment


                  #9
                  Thanks a lot for the help! I'll keep you posted.

                  Comment


                    #10
                    Personally I would get the new apartment and then file Ch 7. A lot of landlords don't want to rent to people in bankruptcy but if you sign a lease first and then file, you can just reaffirm on the lease. And I do think you should go for it, by the way. Wipe out that CC debt and move on. I would not reccomend a #13 for you because both chapters pretty much do the same thing to your credit, so why opt for the one that forces you to repay everything? At least with the 7 you would walk away from the CC debt. You are still young and you have plenty of years to rebuild things. I wouldn't kill myself with the 2 job thing, personally. Good luck!
                    Last edited by Dawn1970; 03-04-2005, 11:26 PM. Reason: typo

                    Comment


                      #11
                      Apt.

                      I filed in Jan 05 and then tried to get an apt. The quick of it is the good ones are not interested in me as a tenent and the ones that are i am not interested in (pure dumps). Good luck as i am still looking for a home that i can afford and is nice too.

                      Comment


                        #12
                        So you need $250 a month more to break even. Break it down that's $8.30 a day; 30 days in an average month. One part of me says; yea go ahead declare BK it's too insurmountable of an amount that $8.30 a day. Then the other part says watch Tim Allen's movie spoofing Star Trek and remember the tag line. Never surrender. Never give up. One Saturday a month delivering pizzas between minimum wages and tips. Home Depot on Saturdays still pays over $8.50 an hour. Go to yard sales on Saturday mornings - take your buys to an auction on Saturday nights. Repeat, never give up, never surrender as much as it takes, as long as it takes. You only lose when you give up.

                        Comment

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