Hi all I am new to this board but have been reading for a while I have a big problem. I have been sued 2 time in 5 days from 2 different credit cards. My DH and I have several more that are delinquent and are thinking that we are about to get hit even worse. None of the debt we have is SOL. Our home and our cars insurance utilities ect we are good on No lates or anything. When we fell into a financial hardship we decided to pay the more important things. What we have is about $25,000 in unsecured debt, after you add in all the penalties, late fees ect. Much lower if you dont. My DH wants to go with a credit counceling service, and I am contemplateing that we should file a chapter 13. We do not have a lot of time to debate this with each other so I am trying to find out what has worked for others. Can either of these stop the impending lawsuits? The first lawsuit is for a card that was only in my name, It is now owned by Arrow think I could possibly win that one The second one is with the original creditor and the last payment was 5/07 They are not willing to negotiate at all and the amount is something that I could swing before the court date and they said they would dismiss with prejudice. But there is one card that if they sue us and are unwilling to coperate we are screwed. That is why I am contemplating filing chapter 13. Any comments would be appreciated as I am truely FREAKING OUT!! Thanks
IMHO credit counseling, in your situation is not worth the time and effort and it will not stop the lawsuits. With $25K in outstanding debt, and potential lawsuits on the horizon, I would start seeking BK counsel, find one you like and can work with. In a Chapt. 13 your payout will be over 3-6 years depending on income. If you qualify for a Chapt 7, that is the route to go. At a later date when you have funds and you wish to pay back your creditors, that would be the time to do it.
Contact a bankruptcy lawyer. If your total household income is below your state's median income you will qualify for a Chapter 7 and possibly have all debts discharged. As Enigma stated a Chapter 13 is a repayment plan. However I do not agree with Enigma's issue about paying back already legally discharged debts, if/after they're being wiped aout in a Chapter 7. Won't do your credit history ANY good.
I will presume that Chapter 7 isn't an option for the OP or they would already be taking it into consideration. Here are my humble opinions: 1) Forget CCCS. It is worthless and looks just the same as BK on a manual review. As Enigma already correctly stated, it will not preclude judgment and in some instances, they further damage your credit. Any BK protection is a better choice. 2) Contrary to the opinion's herein, I would stave off BK. The underlying rationale is that you can probably beat Arrow, move on to credit restoration and potentially sue them for violations of the FDCPA/FCRA. This would at the very least lead to deletion. I would focus on credit restoration right now regarding everything on your report EXCEPT the potential judgment creditor which you would not be able to pay (there are more advantageous ways to work around them). I would settle the amount with the second Plaintiff to avoid judgment. Now, with the above said, BK is easier and your scores will improve much quicker. It will also give you piece of mind. However, I always suggest avoiding it until the possibility of survival without it is present or imminent. Neither seems to apply to you right now. If that potential judgment creditor does file, then you will already be somewhat ahead of the game insofar as you will have improved your credit to some extent through restoration efforts. If they file a civil action, you file BK. Pretty simple really. You may be able to save some money in the time it takes them to sue you. This could serve as a slush fund of sorts. 3) File BK. It is easier but, it will linger for some time and prevent certain types of loans. It will not preclude everything though and you can work on restoration as you go along.
