I am over $40,000 in credit card debt and am considering bankruptcy. However, I just got a good job and will be making over $35,000.yr. Can you still go bankrupt when you have a good paying job?
2007-01-19 13:31:53 · 6 answers · asked by fifimee 1 in Business & Finance ➔ Personal Finance
Yes, you can. You should go see a Bankruptcy lawyer who offers a free consultation. I have seen a lawyer and am starting the process in April or May...when my lawyer thinks the timing is better for personal reasons. The lawyer will have you prepare a VERY detailed monthly expense sheet that will include every little thing you can imagine from dogs shots to stamps to license plate renewals. The courts (federal bankruptcy) will then go over that and if you don't have enough money left over at the end of the month, not much equity in your home or vehicle, they WILL allow you to do a Chapter 7 "Fresh Start" bankruptcy and discharge all your debts. I have a house, car and lots of credit card debt and my house and car are both exempt and I am able to keep them both AND I qualify for a chapter 7 Personal Bankruptcy. Just remember that if any accounts are JOINT with anyone then the other account holder will be responsible for the debt. If someone is ONLY an Authorized User, they are not responsible for any of the debt- ONLY you are!!
I have tried two credit counseling places and they both said to file bankruptcy and at that point I was ashamed. I then tried to work with a credit card settlement place and, yes, they did help me legally settle a few accounts, but due to incomes going down and loss of hours at work, I just wont be able to settle my last big account (big too!!) and I have to file over that one and one other one I have been paying on. I just cant do anything else. So I have tried all solutions and therefore have proven Bankruptcy is my last resort. So I am there too....so all this comes from experience and conversations with a Bankruptcy Lawyer (a good one too!!)
You will only have to file a Chapter 13 (repayment plan) if you have a house with a lot of equity or you do not have many monthly payments (I have cars and student loans)...if you have a lot of extra money each month, then the courts will probably want you to file chapter 13 and take a portion of your disposable income every month and divide it up among your debtors. They will require this for 3 years. After that if you still can not afford the situation, they will usually let you roll it over to a chapter 7 and the rest of the debt is discharged (hence the term chapter 20---7 and 13). But if you have the income still and not many monthly obligations, you will be required to make those monthly payments for up to 5 years and then after the 5th year your remaining debt is discharged.
One last thing, if you go into chapter 13, the courts will not allow you to acquire any new loans or debt without permission first. They usually require permission for anything over $1000.00.
You really just need to go see a reputable Bankruptcy Lawyer who has free consultations and talk to him and they will be able to give you the best scenario for your situation.
Filing Bankruptcy requires you to first talk with credit counselors, then file, then go to a meeting with the local Federal Bankruptcy representative (not scary, really...had family just go through this too), and then you have to have one last credit counseling session to make sure you can budget and all that. Oh, and filing costs about $1000.00. In my opinion, it is going to be worth it. I am still paying as much stuff as I can before I file.
I am over the feelings of being ashamed and embarrassed. I know I have done all I can and that I did my best trying to pay things off. I just can't do it anymore.
2007-01-19 14:58:11 · answer #1 · answered by Kris 3 · 0⤊ 0⤋
I'm a bankruptcy attorney in California. $40,000 in credit card debt is a lot and I doubt you will every pay it off. $35,000 is not what I would call a good paying job. You should be able to find a local BK attorney that will give you a free consultation.
2007-01-20 09:13:24 · answer #2 · answered by Carl 7 · 0⤊ 0⤋
You can, but remember that BK has changed. You no longer get to wipe away your debt. Instead you have to pay all/most of it back and you still get your credit report trashed - not really worth it.
Instead, get a second job and use all of that money to pay down your debt. Come up with a good debt repayment plan and stick to it. Pay minimums on everything but the card with the highest APR. Pay all extra towards that. When it's paid off, move that entire payment to the next highest card and so on.
you can do this. It will take sacrifice and effort but it can be done.
Good luck!
http://www.personalfinance101.org/?utm_source=YH&utm_medium=link
2007-01-19 21:39:49 · answer #3 · answered by personal_finance_101 3 · 0⤊ 0⤋
If your debts are controlling your life, you might be thinking about declaring bankruptcy. But before taking any action, get informed about the different types of bankruptcies and their effects on your life.
2014-11-13 10:33:22 · answer #4 · answered by Anonymous · 0⤊ 0⤋
I believe that you can file bankruptcy regardless of your income. There are major consequences to your credit though. You might want to consider other alternatives though. Check Yahoo! Finance for articles on debt management.
Good luck.
2007-01-19 21:37:25 · answer #5 · answered by antieannie 2 · 0⤊ 0⤋
I don't think you would want to do that to your future. It will affect you for 7 years, which can be a long, long, time for a poor credit rating.
2007-01-19 21:41:50 · answer #6 · answered by desertflower 5 · 0⤊ 0⤋