I have a huge credit/charge card debt and I am overwhelmed with trying to pay everything off. I am a single mother I just want to get rid of the debt because my credit is just awful and I want start repairing it now. Any financial advisors or Bankruptcy attornies that can give me some advice on what I should do?
2006-11-29 02:50:05 · 6 answers · asked by Kokolicious06 3 in Business & Finance ➔ Credit
I wish Debt Guru would tone down his answers. It's bad enough they are self serving, but they are very deceptive.
OK, true. A bankruptcy stays on your "public record" forever. But most lenders don't look at your "public record" (which is actually the bankruptcy court records). Most will look at your credit report, and the BK listing is removed after 10 years.
Just thought I'd point that out again.
And debt settlement only works if the creditor agrees to work with these companies. They are NOT required to do so, and in many cases these companies do more harm then good. Most are fronts for lenders trying to sell consolidation loans! Don't believe me, take a look at the FTC website at http://www.ftc.gov
OK, so what's my opinion? Can't give you one with such limited information.
First take a look at the link below, as it describes what the bankruptcy laws are going to do for you.
Ask yourself this question.....
If you were to sit down and create a very strict budget (no more Starbucks, no eating out, no movies...) and put all of your "disposable" income into paying off this debt, can you do it in 5 years?
For example, lets say after you have made your budget you can afford only $200 a month, and you owe $20,000 in debts. In this case, assuming the creditors are nice enough to wave late fees and interest (yeah, right), it's going to take about 9 years. In that time, your credit report is ruined due to all the late payment and collection notices.
In reality, all of your creditors are NOT going to wait more then 2 years for their money. You will be hammered with lawsuits, collection agents, and still have bad credit for several years.
Or....when you file for bankruptcy you will still be put on a very strict budget. But your bills will be paid off completely in 3-5 years. In most cases you will only be paying back a portion of the debt.
True, your credit is trashed for 10 years. But at least you can start your life over without all the debt and harrassment that goes along with it.
Good luck. BK is a hard decision to make.
2006-11-29 07:34:48 · answer #1 · answered by Anonymous · 0⤊ 0⤋
Generally you should file bankruptcy if (1) you owe more than you make (ie, owe 50k in cc debt but you make 25k), or (2) it would take you longer to pay off the debt than the bk will remain on your reports (usually 7-10 years). Filing bankruptcy will allow you to get a fresh start, and most people can purchase a home 2 yrs out of bk...that's something you just can't do if you were to try and pay off the debt little by little. Of course, your peace of mind should always come before money, and if the debt is stressing you out then which is worse? Keeping the debt and being stressed or filing bk and being able to sleep at night? I prefer the latter.
2006-11-29 03:09:27 · answer #2 · answered by Kevin K 3 · 0⤊ 0⤋
Try one of these credit fixing outfits first. you may be able to get the debt reduced to where you can handle it. I filed bankruptcy last year and I can not borrow anything for at least 7 years, if I keep my nose clean. Try to avoid bankruptcy as long as you can until there is no other option.
2006-11-29 02:59:01 · answer #3 · answered by golden rider 6 · 0⤊ 0⤋
no one should have to file BK nowadays seeing how debt settlement programs exist.
http://www.1800debtsettlement.com has some very good informaiton regarding the negatives of the BK including but not limited to it remaining on your public credit flie for ever. 25 years from now you could be explaining that BK to a mortgage lender.
say no to BK!!!
2006-11-29 04:40:50 · answer #4 · answered by Anonymous · 0⤊ 0⤋
If you can you should file as soon as possible. as long as you have a decent place to stay and a dependable car. Then you won't need credit for a while. So there is no need to keep stressing yourself out about paying all your bills. So look for a way to keep your car and house and you should be fine.
2006-11-29 03:01:55 · answer #5 · answered by rocko 1 · 0⤊ 0⤋
contact a bankruptcy attorney - your first consultation is free - they will advise you of the new laws and if you fit the requirments.
2006-11-29 05:31:02 · answer #6 · answered by Anonymous · 0⤊ 0⤋