I'm still current on all my bills, but sliding further in the hole every month. Let me post some information, and let me know what you think. ====NET WORTH==== Asset Accounts Balance APR Checking 1600 Unsecured Debt / Balance / APR CC1 -2950 13 CC2-4743 9 CC3 -1972 9 CC4 -7124 16 LOC1 -18332 13 CC5 -9400 10 CC6 -4950 10 HomeImprove -4765 10 Secured Debt House -95800 6 Car -5500 5 Assets House 100000 Car 4500 Net Worth -49180 ==NET WORTH== ===INCOME=== He makes 43K/yr. She is likely to be ill or disabled, and bring in $9K/yr if they're lucky. ===INCOME=== ===EXPENSES=== $6100/mo, or $73K/yr HOUSING 665 PAYROLL TAX 875 PROP TAX 117 INSTLMT LOANS 565 REVOLV CREDIT 1190 UTILITIES 361 INSURANCE 381 MEDICAL 215 TRANSPORT 515 ===EXPENSES=== I can cut expenses. I may be able to do some things I'd really hate, and then I'd save about $300/mo, or $3600/yr. The credit card minimum payments are eating me alive. I don't want to bankrupt. My FICO is a hair under 650, and most of my trade lines are nearly maxed. I don't have any late pays. I HATE the idea of stiffing my creditors. Does anyone see a way around bankruptcy? Any way to creatively restructure my finances? Anything?
Well your way in the hole. Total monthly obligations of $6100.00 and you only make $3583.00 before taxes? My concern would be the home. Under a chapter 7 if your in a homestead exemption state your in the clear. If your not then if your married and live in a certain state you can claim a tenant entirety exclusion. What that does is exempts your equity in your home under a chapter 7 filing. Your definitely a candidate, try calling a local attorney and schedule a free consultation.
Re: Re: Does BK Make Sense Here? You are correct. Monthly obligations of $6100. Income is $3583 pre-tax. And we can count my wife's income out, because she just got fired yesterday due to illness-related absenteeism. My equity in the house is......... pretty minimal. Thankfully? , you accumulate virtually no equity during the first year or two of a 30-yr loan. The "Life Management" consultant at my job says that when guys in my situation bankrupt, they almost always keep their houses in this state. By the way, I'm in Ohio.
Re: Re: Does BK Make Sense Here? Tom, you're already bankrupt. You just haven't filed. What I mean is you owe too much for your income. You'll take a hit on the Fico for a while, but you'll have cash in your pocket instead. Rebuilding after BK isn't too hard to do. Especially, with cash in your pocket. Think of how much cash you'll have by not making all those payments. In most states your equity is protected. Most lawyers I've met have said it's better to get behind on the payments otherwise the court may only grant you a CH13 instead of the CH7. If it were me I'd try to get all the things I need too. Food, clothes, car repair etc. If you get luxury items it might be viewed as frivilous and hurt your claim. Obviously, you should check with a BK attorney before doing anything.
Re: Re: Does BK Make Sense Here? Being in Ohio qualifies you to use the tenant entirety exclusion to file for a chapter 7. Like the other poster said your already bankrupt, you just haven't filed yet. My advice start calling around for your free consultation.
Re: Re: Does BK Make Sense Here? Wow. Seems to be a consensus viewpoint. This sucks, as I *really* like my one credit union. I mean.. they're nice, no-hassle, and very low APR. But mostly, they're super-nice. "Member", not customer. Still, in order to prevent them from attaching my assets during default and pre-BK, I'll need to move my assets to another financial institution. If it wasn't both unethical AND illegal I'd try to BT that debt to another financial institution. This sucks. Word to the wise: Don't get optimistic when taking out credit. But I'd wager 95% of you guys in here know that. Of course the game gets more dramatic... my finances are so hosed that even AFTER bankruptcy, I'll have trouble paying my bills. And I have a chronically sick wife. She's not really VERY sick, but she's "a little" sick all the time. Looks like I'll have to down-size. I think the house may have to go. I am pondering renting it out and moving in with my mother-in-law until we can get the wife into a better job, or through a medical certificate program, etc.
Re: Re: Does BK Make Sense Here? Tom, I don't think it'd be illegal to do a BT. Your defense could be that with a lower APR you thought you could handle it. It may be unethical, but I doubt your credit union would mind. The classic move is to use you credit card to pay your BK fees.
Re: Re: Re: Does BK Make Sense Here Well, I'd be much happier letting an anvil fall on.... let's say MBNA or Bank One than on my local happy little credit union. I guess the other bastardly move I'm pondering is financing a gently used car and trading in my 8-year-old domestic (that I'm still making payments on) before I start defaulting on things..
Re: Re: Re: Does BK Make Sense Here Now you're thinking. A lawyer once told me that you should look at Bk as a business decision and try to upgrade or obtain as many things as you can and plan your filing. You don't want to file right after running up your accounts. Let some time go buy. If you take a lot of cash advances or go buy luxury items then it might be contested at the hearing. A good trick is buy gift cards this way you have them for things you need down the road and you can buy what you want without the banks knowing what you're buying. It gives you a little privacy. If you want cash you can buy a Visa Gift card or something similiar and then convert it to cash.
Re: Re: Re: Re: Does BK Make Sense Now this could be a problem. My ATM card doesn't work, so I've been substituting cash advances on my credit union CC. Oddly, this only costs me 75 cents a pop.
Re: Re: Re: Re: Does BK Make Sense Tom, IMO, get to an atty for a free consult, you'll be glad you did.
