If anyone can share their financial wisdom with me, I would help me immensely. My wife and I are in a very tough spot, like a lot of people at the moment. We are currently unemployed, though that could change soon. We owe the MA DOR and the Feds a total of about 10 k in tax debt, about 9 k in credit card debt. 5 k in medical bills, 3 k in collections, and I have a couple of 500.00 pay day loans that I make monthly payments of 130 on. Then we owe 7 k to people who loaned us money in tough times. We are behind on everything. I have been seeking out the chapter 13 BK idea, but we do not have the up-front money for the attorney fees. Is chapter 13 the best idea for us?? Nobody does undecured debt consolidation loans anymore, especially with our credit in tough shape. We rent, so no equity. We just want to gain financial peace and have a plan of action, we cant afford to hire anyone though. Thanks for your inputs, I welcome all advice.
Personal Finance - 5 Answers
Random Answers, Critics, Comments, Opinions :
1
Talk to a real credit counselor -- which will be free. To find a legitimate counselor, contact the National Foundation for Credit Counseling at NFCC.org or call 1-800-388-2227.
2
Your top two debts are not bankrupt-able and neither is the loans from family and friends. they will get paid when you get back on your feet. Stop paying on the credit cards and when you get jobs they will take less than you owe. Medical will go into collections and collections cant get what you don't have right now and they will also settle on smaller amounts when you can pay them. So really the only one that is critical is the pay day loans and to file a Chapter 13 for just $1,000 is crazy. Put on your thinking cap and make that $1,000 ASAP and clear that debt. the rest will all fall into place with cutting back and putting ever dollar you can toward the remaining debt once you have jobs.
3
with no house and what appears to be little in assets a chapter 7 may be your best option. The chapter 7 would eliminate these debts entirely. Many attorneys will advise you of your options in a free consultation In a chapter 13 you would be required to make payment to cover part of these debts. This may be difficult if you are unemployed. If you fail to make required payments the case will get dismissed and at least one credit agency will report the failed bankruptcy for 10 years just like the chapter 10. One of the problems with credit counseling is that many credit counselors are selling their debt management solutions so they are not necessarily any more impartial than a bankruptcy attorney. Recent studies have shown that around 70% of these credit management solutions ultimately fail so use caution. If you enter credit counseling and don't succeed you have wasted time and are back where you started or worse.
4
You might want to talk to a Tax Relief Service. A while back as far as my unsecure debt I got helped with a company called Debt Free League, they were pretty good in resolving my credit card debt of about $12k. I know they work with attorneys that also do IRS Tax stuff, Bankruptcy and Student Loans. Is it affordable? Hell yeah better than paying the full $10k you owe.
5
I think the best advice for your situation would be taking to a govt approved credit counselor. The initial counseling session will be free, and there after depending on what they suggest as a plan of action for you, charges will be very nominal - and even those can be reduced/waived if you request them. It may come down to bankruptcy, but talking to a counselor first may help sort it out a bit. Here are some ideas to ensure your counselor is genuine: http://www.credit-card-debt-relief-info.org/agency-counseling-credit-debt-management.html And here is a link to list of govt approved counselors, by state: http://www.justice.gov/ust/eo/bapcpa/ccde/cc_approved.htm Hope this helps.
0 comments:
Post a Comment