I am 19 and have 12,000 in debt. Can I file for banruptcy?

Question

Thank you for looking. I am 19 years old and already in around $12,000 in my own debt, not counting around $7,000 that I owe my family. The sad part is I dont even know where half of this money went. What can I do to get out? I am really thinking of filing for banruptcy. Does anyone know if I actually can? I just dont know how to pay off this debt. I barely make $2,000 a month, and have a $700.00 car payment. I cant do debt counseling since I cant make such a big monthly payment. Is it true if you do debt settlement, that they can garnish your wages? Please help me. Thank you

Answer 1

move back in with your folks and start paying it down == cell phone internet service goes and so does the car!!!

Answer 2

hi, I am sorry to hear that you are in such a huge pickle.
You say you dont know how you got into this mess and until you find that out NOTHING WILL HELP.
Not being smart but if you dont know what you did to owe 12 THOUSAND dollars then what will stop you from doing it again?
First and foremost you need a budget.
TO do that you have to write down exactly where themoney goes
EVERY CENT OF IT
rent, car, electric
If you make (bring home?) $2k per month you should be able to wipe out your debt in 2 years with a bit of discipline and effort.
I would start by selling your car.
700 a month for a car is waaaaaaaay more than you can afford and if I were your family EVERYTIME I saw that car in my driveway I would be pissed knowing that you owe me part of $7k.
They guy above has the right idea...he oversimplified it a bit since your 12k debt will double since i am sure you have a horrible interest rate and several late/non payments...so it might take you slightly longer to get out of the debt but it CAN be done.
In addition to spending wiser and living more frugal, try to sell stuff you dont need. Sure the car has to go but what about the expensive cellphone/plan, the fast food daily lunch meal etc.
There are plenty of ways to trim your budget but all will require an effort at this point.
Since you already owe your family...why not skip the major gifts this year...instead of some present that you cannot afford, why dont you give them the gift of your new found maturity....telll them that you love them and you are going to pay what you owe them so xmas will be different this year. Give them the gift of your time. Make them 'coupons' that offer your time (clean out the gutters of your mom's home, mow the grass etc).
put the money you would have spent to your debt with them. Also share your plan with them. If you plan to sell your car and they know about it they can 'hold your feet to the fire'.
If they love you (and I obviously think that they do since they loaned you $6900 more than I would loan anyone driving a $700 a month car payment person), they will be happy to help out (ordering pizza instead of insisting on a fancy resturant) etc
Dont know about the debt settlement but any attorney from the phone book could let you know...but until you find out the MOTIVATION for your spending problem (and yes it is a problem to spend 12k and not know where it went)
then whatever you do to get out of it is only putting a bandaid on the problem

Answer 3

I can see where part of the money went. You have a $700 car payment ????? Are the wheels made of platinum ?

I am amazed that you managed to get yourself into such a situation in such a very short period of time after you turned
18.

Meanwhile, you need to go on one serious financial diet. Get rid of whatever those $700 per month wheels are and start paying down your debt. As much as it may shock you, your income level is not sufficient to live and party like Britney Spears.

And, with some of that money you save, get into debt counseling and learn how to manage your money.

Answer 4

You do not want to file for bankruptcy. Bankruptcy will remain on your credit report for about 10 years. You would be 29 by then. You can seriously be held back with bankruptcy on your credit file. By 29 you might want to have a home or something and it can really affect your ability to get a home loan or any other type of loans for that fact.

The first thing I would recommend is you to get rid of that $700 car payment. You must be driving a luxury car..... luxury means you do not need it. Then, assuming they debt is from multiple creditors, call them one at a time and setup payment arrangements. When you finish one, call up the next one and so on and so forth.

Let me do a little calculating for you... if you were to somehow get a $300 car payment (including insurance) then you would have an extra $400 dollars a month. 12,000 / 400 = 30 months. That is about 2 and 1/2 years. As opposed to bankruptcy remaining on your file for about 10 years.

You can probably dish out more than $400 per month to pay your debt. If you added an extra $100 per month it would take you exactly 2 years to get out of the $12,000 debt. An extra $300 per month ($ 700) would get you out in less than a year and a half.

Hope you take my advice... Good Luck.

Answer 5

You can file for bankruptcy, but I would think about it before you do that. Here is one way to solve your problem, sale your car to get rid of your 700 monthly payment. and use whatever is left over to payoff the rest of your lenders. Than get a cheaper car. Bankruptcy can stay on your credit for 7 to 10 years. That means the next time you get a car or credit card you will be a high risk to that finance company, which can ruin your chance to get the loan or credit card. I would try to get a personal loan that way you can payoff all your lenders and your family yourself, and make one payment to one finance company for all your bills. If you do decide to do a BK please make sure you do your homework on how these BK companys will payoff these other lenders. I've seen many times where someone has done a BK through a BK company and they just make monthly payments with the money you give them and payments end up being late.