To BK or not to BK?

[Lostmyjob]

No, it doesn't make any difference. They can still sue you. If you can't afford to pay at least the minimum payment, it is better to pay them nothing. Each time you make a payment, it extends the statute of limitations by one month. The statute of limitations is based upon the last time you made a payment to them.

So it is worse to try your best?

[JimH]

Another thing to think about,.........

In researching our debt options, I discovered a Credit Card forum site.

http://www.cardratings.com/newmessageboardfr.html

I learned there that discharged debt becomes taxable income to the debtor and is reported by the CC companies on a Form R9. The CC companies can also list R9 on the debtor's credit report as well. If I understood it correctly, you would have to be prepared to pay taxes on the dollar amount discharged in a particular tax year.

Sinkingfast, I think you understand correctly but just to clarify....this is correct if the debt is discharged outside of bk. This doesn't apply in bankruptcy though.

[SinkingFast]

Sinkingfast, I think you understand correctly but just to clarify....this is correct if the debt is discharged outside of bk. This doesn't apply in bankruptcy though.

Thanks for clarifying that MINOR point!! LOL

R9 status is for debt charged off by CC Companies outside of BK, not debts being discharged thru BK filing.

[Lostmyjob]

If you add up all of your debt, what the minimum payments will be each month, and then what you have left over as disposable income to pay towards it......if you can continue to make the payments and get by, then go for it. But if you can't and you don't see your situation getting better anytime soon, it really is best to just stop paying. If you have to file BK, wouldn't you have rather been using that money for other bills if the debt is going to be discharged anyway?

But if you see yourself coming into a lot of money soon, then yeah, pay what you can. It will still affect your credit but will slow down their efforts to try to sue you. Since statute of limitations is usually a ways out, 3 to 5 or 7 years, you might be able to save some money by not paying them anything each month - stash it away - then offer a lump sum payment when the letter comes that they're gonna sue. Thats what I'm thinking of doing.

I did a cash advance so I could make payments to give me and the wife time to think.

But she is stressing out about paying money to a lost cause.

In a way the cash advance is digging us in deaper but I wanted to buy us some time.

If we don't qualify for chapeter 7 how much can we expect to get written off?

My wife makes 40K and I use to make 47K. Our monthy credit card payments and mortages are more then her income. My job prospects are bleak. Bad driving record, unethical former employer, previous employer went bankrupt thus no positive job refrences We do have the rental unit rented but the going rents are now less then the mortage Figured $900 a month was better then nothing. The mortage payment is just over a $1K.

Not thinking straight because I should have thought to watch some bankruptcy proceedings. Been depressed and not wanting to deal with things thus the cash advance to buy us some time.

Really glad I found this site Because I don't want to really talk about these things with family and friends. To much blaming the victime mentality.

[JimH]

If you want to figure out how much you'll be paying back, use the info on this site. Your earning are based on the 6 months before you file.

http://www.usdoj.gov/ust/eo/bapcpa/meanstesting.htm