We owe about $30,000 in credit cards because we both lost our jobs two years ago.We have been in a downward spiral for the past two years and have incurred all the debt in that time. Just two years ago we were debt free and didn't even owe on our car. We had to sell our car and buy another one while we still had good credit and we used that money to pay bills until it ran out. Now we are in way over our heads because we are still only making 1/2 of what we were before. Consumer Credit Counselling told us that we need to make $700 more per month before they will take us, but we are both already working full time and we have a family at home. We stopped paying our credit cards about 4 months ago. We are worrying about what legal actions these credit card companies can take. We don't own our own home or any property. Can they guaranshee (sp?) our wages? Help!
2006-08-08 12:26:48 · 9 answers · asked by Brandy H. 1 in Business & Finance ➔ Personal Finance
they willl get a judgemen against you and they will garnish your wages
2006-08-08 13:20:08 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Here are a few suggestions:
1. Make more money. You say both of you have ft jobs, well what are they paying and can you make more at a better job?
2. Set a budget and live within it. Since 2 years ago, you were debt free, you must have had some discipline to do this, find the strength to do it again. It only took you 2 years to acquire this debt, but it may take 5 years or more to get out of it.
3. If you are past 90 days in paying credit cards (and you say you are) then they are most likely turning your debt over to a third party collection agency. And yes, they can take legal action to garnish your wages. I would call them, ask if they will reduce your debt if you agree to pay a high amount over a short time. (Sometimes as much as 60% of your debt forgiven.) I would do all that is possible to arrange that and pay it off. 2nd job for 6 months is not all that bad.
4. Look into a debt consolidation loan from a bank or online. Then all your debt from the credit cards will be transferred to one lender, with a lower interest rate, late fees, etc... and you will only have to make one payment.
5. Think about bankruptcy. This is your last option, and you will not be able to get anything on credit for 7 years (like buy a home, or a new car.) Think about your long-term goals, and see if you can get there working hard or with a black mark on your record.
It's up to you, but best of luck.
2006-08-09 04:09:51 · answer #2 · answered by ht_butterfly27 4 · 0⤊ 0⤋
In your situation, bankruptcy may be your best option. Even with the stricter rules if your income is where you say it is, you should sail through fairly easily. Since you don't own a home, that's not a factor. You usually can keep some equity in a car; or you can recertify the car note immediately after the bankruptcy case is discharged (but do NOT discuss this with the lender on the car note until the bankruptch is discharged! That is considered fraud!)
Once the bankruptcy action is filed it will stop any collections cold. They will not be able to garnishee your wages either. There are a few things that cannot be cleared through bankruptcy such as child support, and taxes. If you're not behind on taxes or owe child support you don't need to worry about that.
Your best bet at this point is to talk to a bankruptcy attorney. Bad things do happen to good people sometimes, and that's what bankruptcy is there for.
Good luck!
2006-08-08 12:51:15 · answer #3 · answered by Bostonian In MO 7 · 0⤊ 0⤋
im sorry to hear about your troubles, this is my best advice:
forget about credit counseling, all they do is advise you on how to budget and negotiate deals with your creditors that the creditors would offer to your directly if you called. credit counseling is a watse of time and money in my opinion.
file chapter 7 bankruptcy. you will need to see (and pay) a lawyer to do this but its worth it. this will get rid of all your unsecured debt. it will hurt your credit at first (which doenst matter in your case) but it will give you a fresh start. a couple of months after the bankruptcy is discharged, go out and get a couple (at least 2) secured credit cards. within two years you will be in decent shape with credit and you will not have to repay all that debt!
while you are going through the bankruptcy, you need to make it a priority to get higher paying jobs long term. i know its not easy, but if you give up, you will never get it. you need to make enough money to support yourself without going into debt.
2006-08-08 12:51:56 · answer #4 · answered by Silberswarz 2 · 0⤊ 0⤋
go for chapter 13 it will sen the Bogey man away but you will have to live with it the next 7 to 10 years and pay as you go, there will be no more credit.
2006-08-08 12:33:42 · answer #5 · answered by ? 5 · 0⤊ 0⤋
Bankruptcy was designed for this type of unavoidable situation.
Do not be ashamed to file - you have a legitimate need for that kind or remedy and protection.
2006-08-08 12:45:16 · answer #6 · answered by Grist 6 · 1⤊ 0⤋
well, I don't promise anything but
here's two links that often get me best answers:
http://credit-cards.ebookorama.com
and here http://finance.ebookorama.com
you may also pass them around and help anyone get rid of their debts, people always seem to find help via these links so spread the karma and get points.
good luck!
2006-08-10 12:00:37 · answer #7 · answered by Anonymous · 0⤊ 0⤋
that sucks can your parents help you. i will pray for you tonight. but why havent you found another job
2006-08-08 12:32:53 · answer #8 · answered by born to live, bred to die 3 · 0⤊ 0⤋
There may be something of use here.
2006-08-08 19:54:50 · answer #9 · answered by Anonymous · 0⤊ 0⤋