Credit Card debt!! I need some SOUND advice, please! I live in Central New York, lost my job 3 months ago?

Question

...and am living on my credit cards. I am in debt 40,000.00. I met w/ an attorney today and he told me that I have to stop using the cards, get a job, and keep paying the amount due before claiming bankruptcy. How can I pay on the cards, not use them and live without money coming in? I have never been late on a payment, EVER, but I'm drowning in debt and no job, with none in sight(I used to make 40k a year, lost my job, been looking for months!). I own my car, and I just moved in w/ my boyfriend to make ends meet, they can't take anything away from me. Should I stop paying on them? max them out (against everything I believe in, everyone does this, my friends say)? take my chances? Can I go to jail for this? What will happen if I can't pay them? I need some REAL sound advice here. Thank you SO much for the replies. I'm an honest person who never thought this would happen to ME, please don't judge me. I only hope this never happens to you. Please help me.

Answer 1

I am a mortgage broker and work on repairing credit, I answer like two of these a day. If you stop paying the debt then the debt itself will be sold to a collection agency for pennies on the dollar (when the debt is sold it hurts your credit). So lets say that all your debt (40k) is sold to a collection agency for 10k, the credit card companies sell the debt and write off the loss. You can then Negotiate the debt with the collection agency so you can make that 40k debt turn into 20k with no interest you just have to pay these people.

or you can max out your cards and file bankruptcy, you should consult a bankruptcy lawyer first, it doesn't sound like the first on you talked to was much help, why would you pay off the debt then file for bankruptcy? If you just make the minimum payment on 40k of credit cards debt it will take over 50 years to pay it back and you would have paid a total of 200k on the 40k of debt.

good luck Hun.

Answer 2

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RE Credit Card debt!! I need some SOUND advice, please! I live in Central New York, lost my job 3 months ago?

...and am living on my credit cards. I am in debt 40,000.00. I met w/ an attorney today and he told me that I have to stop using the cards, get a job, and keep paying the amount due before claiming bankruptcy. How can I pay on the cards, not use them and live without money coming in? I have never been late on a payment, EVER, but I'm drowning in debt and no job, with none in sight(I used to make 40k a year, lost my job, been looking for months!). I own my car, and I just moved in w/ my boyfriend to make ends meet, they can't take anything away from me. Should I stop paying on them? max them out (against everything I believe in, everyone does this, my friends say)? take my chances? Can I go to jail for this? What will happen if I can't pay them? I need some REAL sound advice here. Thank you SO much for the replies. I'm an honest person who never thought this would happen to ME, please don't judge me. I only hope this never happens to you. Please help me.

Answer 3

OMG! I thought I was worse. I had lost my job too and had to live off of credit cards. I only owe $2500 now. I own 3 cars and I had no choice but to sell one and I did. I also got some help from family members and my parents, thank God! I sold some of my clothes and jewellry eventhough I really really didn't want to but the thought of getting into debt too deep, scare the crap out of me. I ate whatever was in my fridge/freezer and pantry without buying anything else. I had never felt so poor before in my life. I guess the difference is, I'm a home owner and if I have too much dept that I can't pay, theres a big possibility that I'll loose it. I really didn't want to come down to that. What I learned from it is, save some money for rainy days. I used to spend money on stupid things that I didn't need. This is sad but your attorney is right. If you can't pay up, your creditors will take everything of value that you own, and possibly go to jail. I know its hard but you can do it. Live off of what you have right now, food, clothes etc. think of things that you can sell for money. you'll have money again in the future to buy those things but right now, you are in a deep hole and you need get yourself out of it. nobody can help you if you are not willing to help yourself. ask family members and friends for help. I would cut up those credit cards right now. Keep looking for a job and you might work 2 to 3 jobs to keep up with your dept. don't forget you credit score to keep it in good shape or else you'll suffer. Keep praying that you'll find help and a job, I did. I was able to find a really good paying job later (loan officer) and now I know to always have some money save up because you'll never know what the future will bring. hope you'll find a job soon and good luck. you can do it!

Answer 4

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.