NL Posted November 26, 2004 Report Posted November 26, 2004 Hi, My girl is 20k in debt. She hired debt consolidator company 9 months ago, they promised they reduced her rate to 1 payment. She thought they were paying the cards monthly, but she was scammed (she's very naive, didn't think anyone would lie.. southern girl what do you expect). Trying to help her out now, we trying to sue the scammers, but meanwhile trying to figure out what to do with the debt.All the cards except 1 have been sent to collection agency and I am sure her credit is ruined, and the one that hasn't been sent to collection yet, she is trying to settle with them and they working on it.She barely makes enough to cover her living expenses, so what to do ?Should she go for bankrupcy? or just Debt Validation with the Collection agency and ignore them until they sue, if they sue? What you think is best way to get this matter resolved so she can go on with her life?Is BK hard to do? Or just a matter of filing a form?Thanks in advance.
bingo Posted November 26, 2004 Report Posted November 26, 2004 BK will involve filling out multiple form!She will have to completely disclose to a trustee her salary, assets, debts and, living expenses. I'd suggest she use a lawyer to get it right. Most bk lawyers give free inital consultations. Have her speak with a couple and get all of her options explained.From your brief description, she should have no trouble with a Chapter 7 discharge. Does she own a home and a car? If so, what sort of equity do they have and what state is she in?
NL Posted November 27, 2004 Author Report Posted November 27, 2004 Hi Bingo, thanks for your reply...She doesn't own a home.She has a car, but the title and loan is under her parents and she only got it a few weeks ago.She currently living with me, and doesn't have an income. She should be done with her degree in 7 months, and then she will be teaching and making teacher salary.Do you still think she makes good canidate?My question really I guess, is she better of with bankrupcy, or is she better of trying to work these debts. (My parents and her are willing to loan her money to settle with these CA). But is it better to try and negotiate with the CA, or just ignore them and DV them all? Or is it better to just file chap 7 for her? What are the plus and minuses I guess?NL
bingo Posted November 27, 2004 Report Posted November 27, 2004 I would not borrow money to settle $20K worth of defaulted debts unless, she can do it for 35% or so. You can't borrow your way out of debt and I'd hate {personal opinion} to owe family money and not be able to repay.If bk is a real option, she needs to do it now. Not when she may have a job making enough that'll put her in a position to maybe have to repay a chunk of the debt in a Chapter 13.I dunno what to tell you as to which is better. Ifthe validation does not work and she gets sued, a chapter 7 may not be available to her since she may well be making more money.
Guest jeeptravel Posted November 27, 2004 Report Posted November 27, 2004 File it now and start the new job debt free. It will be 6 months before the court appearance and discharge is over so get going now.Plan to spend about $1000 bucks altogether to discharge 20K.It sounds like a simple case.BTW her credit will be sacked for at est 6 mos. But she can recover rather quickly after that once she shows steady income and good record post discharge.Good Luckjt
NL Posted November 27, 2004 Author Report Posted November 27, 2004 Thanks for all the opinions.Quick question: She settled with the 1 card that didn't go to collection, for about 60%, and she is suppose to make 3 monthly payments starting Nov 30th. Se gave them the bank info to draft. If she going the BK route, should she just call up Discover card and say NOT to draft the payments from her account afterall? She doesn't have more than $300 in the account, so even if they tried it would fair, but then she would incurr bank penalties. So what's the best course on this?
Guest jeeptravel Posted November 27, 2004 Report Posted November 27, 2004 Call them up and tell them you are fiing BK7 and please stop debiting on your checking account. If you want, you can pay your bank $10 or so to block their EFT.jt
linko Posted November 28, 2004 Report Posted November 28, 2004 I am really trying to make an informed decision here, but a bit confused on 1 or 2 things.My CC debt (20k) all in CA. I am trying to decide on whether to settle or file BK 7. In order to settle, I would have to borrow from family, as I have no job or assets currently and hope to have a job in 9 months when I finish my teacher certification.In order to make this informed decision, I need to understand what impact will a BK have on my life? Will I be able to rent apt, will I be able to ever buy car? what other impact will it have?Further, I need to understand, if I try to negotiate with CA, chances are they will agree to settle and possible remove their inquaries from my credit, and maybe if I am lucky get the OC to change to "paid". Where I am confused and need clearing up on, is what impact compared to BK will this have on my credit and future. In other words, how much better off will the my credit be by settling with CA in comparison to filing BK?Please help me better understand my options and consequences and implication on my future so I can make an informed decision. (I live in TX).
Guest jeeptravel Posted December 5, 2004 Report Posted December 5, 2004 It's easy to buy a car on credit after BK. Just be prepared to pay big interest rates.As far as renting . . . It depends on the rental company. My wife and I found a private landlord who we shared our story with and we were able to rent a house immeduately after discharge.Nonetheless, I can't romise you will ave the same results. Big down payments in cash speak volumes.jt
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