$45,000 in Credit card debt....?

Question

Business credit cards, (Business name and in some cases my name on card as well) and my own personnel cards as well. About to begin closing company, but calls are fast and furious from CC companies. I own a home but after taxes and mortgage payment I'm left with about $200 a month. Where do I begin and since I owne a house and car, why is bankruptcy so bad?

Answer 1

BK is bad for 2 reasons

1- it is wrong to steal. You spent the money and agreed to pay them back.

2- It stains your credit. It tells other lenders that you have had a difficult time in the past in paying off your bills. They know you are willing to let them take it is the shorts for lending you money.

Having said that, there are times when it is just not possible to take the high road. Do what you can. Try to honor your word. BK exists as a fall back, but it should be an absolute last resort.

Answer 2

I am not sure you can file personal bankruptcy with the changes in the law from October 2005. You should contact an attorney to see if that is an option. Why not refinance your home, settle out the CC debt for 50 cents on the dollar or less and move on? Check out the source website for more options. Good luck.

Answer 3

Sorry all the other people on here are so down on you.

Sometimes you get into debt.

Your lucky that most of the debt is the business. No one can come after your personal property if your business goes under.

Now the personal debt, you can file bankruptcy. If you are unemployed you should qualify for a straight out Chapter 7. I never thought bankruptcy was bad, I mean you get out of debt, even if it stays on your credit for 7 years, after two years you can get loans again and to start out you get get a secured credit card and get your credit rating back up. Not to mention once you file, everyone STOPS calling you. It is SO liberating to tell them, Talk to my lawyer, I am filling bankruptcy!!

Steven is incorrect...if your business was an LLC then you are personally protected.

And you don't NEED income, you can file bankruptcy and be better off.

Answer 4

I am very sorry to hear about your situation.
Obviously there is not going to be ANYTHING you can do if you are only making $200.00 towards $45k debt.
If you want to pay the debt you are going to have to find a way to scale back ALOT.
Unfortunately for you the laws changed in either 2005 or early 2006 and the jist (gist?) of the change was that it is ALOT harder to place your credit card debts in to bankruptcy. Be sure to talk to an attorney who specializes in just that!
HE will probably confirm what I am telling you but might have a way for you to code the bills a bit differently (Heloc for example).
Beyond that I really dont think anyone is going to be able to help you with a solution but you. Obviously the solution will require you to either cut costs or increase income.

I am not sure what kind of business you have but is there a way that you can sell your inventory to recoup some of your losses. Be sure to talk to an accountant and inquire about writingoff a great deal of your losses on your income taxes. That might get you a bit of money on your return.
Best of luck to you.....just so you know first businesses have a high failure rate but most of the entrapenures (sp) second attempts are much more sucessful. Best wishes for the sucess of your next venture!

Answer 5

Chapter 7 bankruptcy is the commonest denotation of bankruptcy. It stands for waiving or canceling of debts that you have incurred. As an individual, you can select between Chapter 13 or Chapter 7 bankruptcy. Selecting between the two is not easy. The bankruptcy court will study your circumstances before deciding which type of bankruptcy is applicable to you.

Answer 6

Speak to a bankruptcy atty. It may be the only way to keep your house.

Ask him or her to advise you of all the downsides.

Bankruptcy, especially business bankruptcy, exists so that people and companies may have a fallback and not be forced to go to debtor's prison when they take risks to serve a purpose in our capitalist society. There is nothing morally wrong with it. Financially, it's going to put a hurtin on that credit report - but that is the price

Best of luck

Answer 7

I suggest you to join a debt settlement company who will negotiate with your creditors on your behalf and try to bring down your principal debt amount by around 30% to 70% depending on your credit cards.

You can make minimum affordable monthly payments and get out of debt within 36 months. There are no upfront fees and hidden costs associated with the monthly payment. Once you joindebt settlement program all the calls and any other form of communication by your creditors will be directed towards the debt settlement company and not to you any more.

Check out this debt settlement company who has helped me out with the same unsecured debt situation.

http://www.debtfreeafterall.com

Good Luck

Answer 8

If you have equity in your house, you could sell it and pay off all your debt. Rent for a year or two to build your credit back up and then purchase again. Sounds like your house is too expensive for you anyway if you only have $200 left each month.

Answer 9

ifyouwantwhatwehave is NOT correct. If your business was anything other than a C-corp, your business debt IS personal debt. If you personally guaranteed the debt, even a C-corp does not relieve you of the debt.

What you need is an INCOME. Even without the debt, $200 a month in not enough to eat and pay your utilities.

Answer 10

I have placed this in the source box. There is a wealth of information there and a great free debt management software program. I bookmarked the site as I return to it often for the advice it offers. I hope this helps you.