inwayoverourheads

In way over our heads with no options?

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I'm new and accidentally posted under the announcement area so please excuse the duplication of my post.

Hi! I've been trying to figure out what to do for the past month. Unfortunately, we are in WAY over our heads. For a period of time we borrowed from other credit cards to pay other credit cards and make ends meet - we've reached our limit and have no way to pay. It certainly wasn't planned that way and ashamed doesn't even come close to telling you how we feel about it (we being hubby & I). I'm in school full-time and my hubby has a decent full-time job. I can't work on top of school and the whole purpose for school is to better ourselves so we can make ends meet. Is disputing an option for us? BK is not an option, I'm on all of my parents belongings (meaning, my name is on their house, bank accounts, etc.). I'm constantly getting phone calls and haven't answered the phone because I honestly don't know what to tell them. Can anyone give any advice on how we should handle this and what we should do? Thanks! :?

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Sorry to say I believe BK is your ONLY option. You may have to remove yourself from your parents accounts and bite the bullet.

How long until you are out of school? You will have to start paying those back after you finish and that will be more of a burden.

Will you have a job when you finish? that may help if it is not too far off.

Back to you being on your parents mortgage, bank account, etc. If they get a judgement against you, they can very well go after those items that belong to your parents as long as your name is attached.

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Thanks for your reply. So, you're saying a charge off in not an option for me? I guess I don't understand why some people can dispute the charges and not pay anything while others have to go BK. :( I know it has to be at least one year with my name off my parents accounts and such before I can go BK and not have anything come against my parents. What do/can I do in the meantime? I'm in PA if that makes any difference.

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I guess my main point is that if someone gets a judgement against you, they MAY be able to attach bank accounts and put a lein on a home/auto/RV.

If you get those taken care of, then they can only come for you. You may be able to skate for a year and file. Use a bank account in someone elses name and pay cash when possible. Get the car you drive in anothers name, etc.

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In response to my schooling, I'm still in my freshmen year so I have a ways to go. A job isn't anywhere in the near future, unfortunately. We still owe quite a bit on our home, not sure what they could do there? I read somewhere that if you call the credit card companies and tell them you're going to go BK they may offer a counter-offer meaning they lower what you owe just so they get something. I'll have my parents take my name off their bank accounts and house, etc. If my name is removed now, can they still go back and take from my parents? I'll have to look into getting our cars in someone else's name. I'm not sure what to do about the house?? It's only worth about $55,000 and we still owe about $40,000. What do you think?

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I can't make a blanket statement on any of this really. It just depends on who it is and how much you owe. CA1 may sue you for 200 bux, but CA2 may just bug you now and again for 5k.

Also, I am not sure if PA has a homestead act so they can't take your home. I suppose if someone here is up on PA law they could help, or you could try to do some research on it.

Be patient, some of the other regulars will no doubt chime in with soem other suggestions and/or additional help.

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Bad news about BK. According to NOLO, PA has no homestead exemption. That doesn't exactly mean that you would lose your home if you filed BK, but if the amount of equity you have in the house gets the attention of the BK trustee, they might just grab it to pay off the other debts.

Being in over your heads is not something to be ashamed of...sometimes bad things happen to good people, and we can't always forsee where choices will take us.

First, I would suggest getting your name removed from your parents accounts...unless, they only receive SSI or other retirement and you're on their checking account to write out their checks for them. A BK trustee would probably...note...probably allow that. If that not the case, sever all ties to their accounts as soon as you can.

Then, how much total CC debt are we talking about?

Like DocPC says, once your parents are protected from judgements against you...then you can probably tap dance for a year or so with CAs to keep them at bay...all depends on how much you owe to who...

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Good grief, wish you wouldn't have asked - we're talking about $30,000. I saw your jaw drop, lol. Not funny, I know. Eight different creditors. The whole reason I'm in the mess is because I'm a phenatic about things being late, can't stand the thought of it and if I'd have just dealt with it then it wouldn't be near as bad. I feel nauseous. They (my parents) aren't retired so I will have my name removed from their accounts. I'm worried about losing our home. I honestly don't know what to do other than remove my name from their accounts. I suppose I should start looking for an attorney?

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Don't know if it helps, but just know that you're not alone. If you add up our business CC debt and our personal CC debt, we were approaching $200,000. Its really easy to lose control...

Actually, talking with a lawyer would be a really good idea. Most BK attorney's will give you a free consultation and you'll get some PA specific guidance along the way. Just remember not to sign anything and to talk with several before you make a deceision (when I learn to spell, I'm gonna be really dangerous). You want to pick a lawyer you feel comfortable with...not one that will just fill out the papers. Maybe BK 13 would work for you...

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And how are you handling it? I know there are always those that have it worse and I'm not asking for anyone's pitty - we did this to ourselves. I think I'll set up appointments this week to speak with a few attorneys - we live in a small area so I'm not sure how many are specific to the BK field. What is BK 13? I know there are a couple different BKs to choose from but I don't know what any of them really are. In the meantime... do I answer the phone? And, if so what do I tell them?? Hey, thanks for all your replies, I'm really glad I found this place! :)

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Well, you can read our big long sad story at:

http://www.debt-consolidation-credit-repair-service.com/phpBB2/viewtopic.php?t=15634

...bottom line is we did a personal BK 7, and just let the business die. And, yep, we did it to ourselves also...

If you want some lite reading, NOLO Press offers two books on the subject of BK. You can get them both through amazon. They're intended as do-it-yourself books, but they also will help you understand what's involved.

A BK 7 effectively wipes your slate clean...except for taxes and student loans. You turn over all your assets to the BK trustee except for a few things which are "exempt". You list all your debts..some of them are secured debts, where the creditor has the right to take back the property on which he loaned you the money (like your house)...the rest of your debts are unsecured. The trustee he picks which assets he thinks he can sell (like your house) and "abandons" the rest back to you. If he can raise any cash through the sale of things, he distributes that among your unsecured creditors. If there's nothing to sell, the unsecured creditors get nothing. Either way, those debts are considered discharged. You're left to deal with the secured creditors and the abandoned assets.

A BK 13 only works if you have a source of income. Again, you turn your finances over to the trustee along with a plan that says how much "disposable" income you have each month after you've paid your secured creditors and bought food and clothes and so forth. The trustee takes his cut, and then divides the disposable income among the unsecured creditors. You pay that amount for 3 to 5 years...and that's all the unsecured creditor gets.

Talk to the attorneys...read the books...

And...as for the phone calls...if its the original creditor calling, you might talk with them IF you have a good reason why you haven't paid. Be prepared to take some abuse...the OC is not bound by the FDCPA and some of them do get belligerent. Don't let them bully you, and don't let them talk you into paying something you can't afford. Politely say, gee, I'm sorry, we just don't have the money and I don't know when we'll be able to pay you.

If its a collection agency calling...NO...do not talk to them on the phone. Anything they tell you will be a lie or a threat. You only deal with a CA in writing. In fact, if you have letters from them already then by all means send them a request for validation along with a "I'll only communicate with you in writing" letter. If the CAs are after you, you needn't wait to decide if you're going to BK...DV them now. That will at least put a stop to most of the phone calls.

You might also check into whether your phone company offers "Privacy Manager" for your phone. Its a way that lets you decide who can call you. I mention this because some of the CAs don't play by the rules and may keep calling...

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30K isn't much....DF filed on 45k because she took a huge pay cut and nearly went under. She now has recovered, makes more money (same employer, she just hung in there), has a high TU score near 700, EX is near 680, and EQ is around 640, and has been pre-approved for a mortgage with 100% financing.

All this just over 1 year after discharge. It can be done.

EDITED TO ADD: Listen to willingtocope. This member has a lot of experience with these issues.

Thanks for the tag-team willingtocope!

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Wow, that's a lot to go through (just read your "story")...

I'm thinking I need to have our house and cars put into my parents names so we can keep them. I'll have to talk to them about that though - it's a lot to take on even though we're responsible for it still.

Basically, BK 7 you don't pay anything except what they can take and BK 13 you pay what you can afford for 3-5 years then?

I have so little free time - as I was "talking" to you last night I should've been studying as now that's what I should be doing. This full-time school stuff is way more than a full-time job. I have no free time, no life but then I have no money to do anything with a life anyhow... Being broke really bites!

No CAs calling yet - we're only 30 days behind. Only... well, you know what I mean - it's far enough behind when you're crazy about having things paid on time like me. Really bad thing is 10 years ago we went BK (must've been 13) because I was pregnant and on bedrest - unable to work and we couldn't make ends meet then - we're finally at our 10 year point and here we go again. The attorney was no very helpful - he did the paperwork but wasn't good about returning phone calls or even answering questions for that matter and as I said previously, it's slim-pickin's in a small area (about 14,000 population).

I would rather do DV but what is the opinion on that from you knowledgeable folks versus BK now knowing my entire situation?

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I guess this is where I should add that we certainly have more debt that the $30,000 - it's just what we felt we had to let go. Our total debt including our home and one van we owe on is $100,000. We can't lose our home (we have a family and I know the court probably doesn't care about that because we screwed up we need to do what we can to get out of this).

And, what about DV after BK as I noted above? I know another BK sets everything in stone but then we can find a way to survive without any credit at all. It's possible to survive, harder but possible.

I want to thank both of you (DocPC and WillingtoCope) for all your input, I GREATLY appreciate it. Nice to know I'm not alone. :)

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Okay...some answers...

Transferring property into your parents name probably isn't going to help. The BK trustee may take a dim view of that. Ask a lawyer...

Your understanding of BK7 vs BK13 is right...

DVing the OC may buy you some time, but, they really are not bound by the FDCPA and they may not respond. Like I said, depending on the CC, they may get nasty with you on the phone and there isn't much you can do about it until they turn it over to collections. Get privacy manager..its only like $6 a month here....it'll let you know who's calling. The really good thing about privacy manager is that most of the calls get stopped in the phone system...it doesn't even ring at your house, and even if it does you know who's calling before you decide to answer.

As for what you owe...divide it into secured (mortgage, car) versus unsecured (CC) and see where you stand. The secured debt you probably want to keep..

And...if you're only 30 days late on the CC's you shouldn't be getting phone calls on those yet...it usually takes 60 days or more to get their attention. At 90-120 days they'll turn it over to collections (which you can DV and maybe make some money on, if you're willing to fight back and go to small claims court). After 180 days, they'll charge off and then you have even more DV options.

Bottom line...your credit is probably shot NOW. Don't lose sleep over it. Concentrate on paying your secured creditors, buying food, and living. There isn't much you can do about paying the unsecured people unless your income would increase significantly real quick...so use the system to fight back...make them play nice...and if you have any questions, we're all here to help...

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Lots of complicated issues here. You should seek the advice of a qualified attorney. Transferrance of property while in financial distress can still be considered unlawful beyond thirteen months in many states. The attorney can advise you on a course of action for a future bk filing. Many people do things in an attempt to keep secured property, but bk laws address property you control as well as what you own. Your husbands employment could be a magnet for recovery and debtors with the best chances of charging off with no further action are quite simply those people who own nothing and have low wage or no wage jobs.

Being in school full time incurring expenses will be taken dimly by creditors as well. You should balance your time between school and at least a PT job. I presume the best advice otherwise is to simply ignore all creditors and let them just come after you with default judgments, then deal with the bankruptcy issue after you have acquired a FT job sufficient to allow for a court approved payback schedule.

There are no easy answers for you, but at least the good news is, if you or your husband are employed in PA, your wages cannot be garnished!

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i'm gonna suggest you can always try talking with your creditors, you say you are only about 30 days behind, and i know that really sux when you are fanatical about paying on time (sounds like me :))

but give it a try, some may work with you, lower interest rates, work out a repayment option you can afford (that one is incredibly important, dont agree to more than you can afford!!)

others will not work with you, they are the ones you will just have to ignore and work on in different ways, follow the good advice that has already been said here.

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I'm actually not even 30 days late and they're calling me umpteen times a day, I have caller ID so I know when not to answer it. I have no money to pay them, period. So even if I answer the phone I can't give them anything and they'll keep harassing me until I do give them something. Can't get blood out of a turnip? So far today, I've had 8 calls and it's only 1:30pm. They don't leave messages, which I'm not sure why. I guess I can send them a letter stating I will communicate with them through letters but then I'm afraid of saying the wrong thing and having that get me into trouble. I want to pay them, I just can't right now. I'm going to have to sit down and do some real evaluating - I do know I'm not going BK. My mind is spinning and I'm really feeling lost...

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Something doesn't compute...

CC card companies would NOT be calling you yet if you're not at least two payments behind. And they certainly wouldn't have turned you out to collections as yet.

The only people I've heard of doing this are "Buy here, Pay here" car dealers, Pay Day Loan people, and loan sharks.

If indeed all you're behind on is CC and it hasn't been 45 days or more...I'd say pick up the phone and find out what's going on. Put your guilt aside for the moment, and see who's calling.

Back when we were just about to fall apart...hadn't missed any payments yet, but were planning on it...we got a call from AMEX. Someone had charged two plane tickets to South Africa on our account, and they were checking to see if they were legit...they weren't, so AMEX canceled those cards and issued us new ones.

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The 15th will be 30 days but it is the credit card companies calling. One of them I owe $8,000. Our number is unlisted and we are on the "do not call list." I thought it was a little soon for them to be calling but I do have caller ID and I did pick up once and it sure enough was one of them and that one I only owe a total of $700 on. No kidding.

I'm putting a plan together. Making a list of things I can sell and cutting things I can cut like the cable, second phone line, keeping the heat down, etc. to cut down on monthly expenses. Going backwards, isn't it great!?!

Your credit problem wasn't your fault then - ours, no doubt about it. It's OUR fault, not just mine. I tried talking to my hubby on SEVERAL occasions about our finances and he kept refusing to talk to me about it - I did what I felt I had to in order for us to get by. I'm not taking full blame for this.

Funny thing is, I keep getting all these pre-approved CCs in the mail. No, I'm not caving I'm in far enough but what are these people thinking?

It could be that they started calling because I've never been late and they're trying to see what's going on. They might not be ready to fully harass me yet but honestly, I don't have the money and I don't know how or when I can pay. All I do know is that I'm going to make the changes I need to make and we'll pay them somehow, someway.

What would happen if when I cancel my second phone line if I canceled the one they keep calling? They're both unlisted. Is that unlawful?

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eh! dont play the blame game, no one EVER wins that one..

lets just say, stuff happened and now here you are ready and willing to sort out the mess, thats all that matters. how and why is irrelevent, we all have a tale to tell, dont be hard on yourself.

as to the phone, its your phone, you can do whatever you like with it, change the number, get a new one, doesnt matter. but i still think you should try and write them (since you dont want to talk on the phone, and theres nothing wrong with that) and see who will be willing to work with you.

chin up! things can only get better :)

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Which credit card is this? I've never heard of one calling at 30 days...

And...look...yes, its wise to cut back if you can, and you certainly need to live within your means now...no more credit cards...

But...don't go overboard...see to it your family has a place to live and food to eat and enough entertainment and distractions to keep you from blowing up at each other.

Okay...you do owe money to the CCs. But, if you don't pay them on time and at least the minimum, their systems are set up to punish you into further debt. Send less than the minimum or miss a payment and most of them will hit you with a late fee AND jack up your interest rate. Those tactics are intended to "encourage" you to meet their requirements, but in fact will drive you into BK. And, long before that happens, the CCs will CO your accounts (and the US Taxpayer will compensate them for their loss) and turn you over to collections.

Bottom line...don't get hung up on the "morality" of owing this money. If you can decrease your expenses, and increase your income, and meet their minimum payments...do it. BUT DON'T IF THE NUMBERS DON'T WORK...SCREW IT...TAKE CARE OF YOUR FAMILY.

And...no...there's nothing illegal about changing your phone number. Get a cell for your personal calls...and if you're using the second phone line for internet connection, look at adding that onto your BASIC cable...

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Household Bank is the one that called before 30 days and they're the one I only owe $700 to. I looked back on my checkbook - this one will be officially 30 days late on the 6th of Oct (2 more days). Maybe they're calling me earlier than normal because of my past bankruptcy (risk). I don't know, all I know is I wasn't even 30 days and the calls started.

Are you saying that having entertainment money (limited) is still something I can consider until I get these paid off? I know what you're saying. We wouldn't need to go to the movies but maybe we could rent one. We can maybe go to McDonald's but no steak restaurants, lol. Or maybe once in a while I can BUY us a steak and cook it on the grill instead of eating it out. I'd feel too guilty. I have a bunch of notes that I made today from all your suggestions and I'm going to talk to my hubby here momentarily. He hates discussing these things but it's just something we need to discuss, plain and simple. And, sorry about earlier - I wasn't trying to place blame on him it was more of my disgruntled attitude from him blaming me when I tried so many times to talk to him - frustration.

My phone, my choice? Okay, I know which phone line I'm canceling then...

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Well, I called them all - been on the phone for about 2 1/2 hours - negotiations didn't fare well. Considering my record up till now with them has been very well - no late payments I figured they would try to work with me but 2 of them are already in collections!!!!!!!!!! They don't mess around... I figured it would be 60-90+ days before that happened but nope 2 of them are already there. It's official, we're ruined, never to buy a new car again - better hope mine can chug along for quite some time...

Enough self-pitty - going to turn in - all those calls made me ill and very tired.

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Okay...you do owe money to the CCs. But, if you don't pay them on time and at least the minimum, their systems are set up to punish you into further debt. Send less than the minimum or miss a payment and most of them will hit you with a late fee AND jack up your interest rate. Those tactics are intended to "encourage" you to meet their requirements, but in fact will drive you into BK. And, long before that happens, the CCs will CO your accounts (and the US Taxpayer will compensate them for their loss) and turn you over to collections.
That was the thing I found most baffling. When trying to work with the cc companies when I could see things were heading south fast most said, "We can only offer you special programs once you're in default." It was frustrating.
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