Bankruptcy Time?

[movingbackwards]

I've been considering BK for awhile now, and was just hoping to get some feedback here. I have unsecured debt of about $20,000, and owe roughly $10,000 to my family who have tried to help me. I used to make 50-60K a year with my previous job, but lost that about 14 months ago. Since then, I've been at a job where I make roughly 17-20K a year. I burned through my savings trying to keep up with my bills, eventually selling my truck and other items of value. When my savings ran out, I stopped paying on my big credit cards, but kept my smaller ones current until recently.

This is where I stand as of now.

Chase (V) $8657 last payment 8-21-06

Bank of America (V) $3925 last payment 9-28-06

Gap Card $470 last payment 1-24-07

HouseHold Bank (MC) $1684 last payment 2-6-07

Shell (MC) $2003 last payment 2-26-07

Capital One (MC) $2052 last payment 2-26-07

Medical Bills $345 In The Process of Garnishing Wages

Signature Loan $1408 $90/mo Current

Drivers Responsibilty Fee $1100 $100/mo Current

I make about $1200 a month with a raise that I got this week, and have living expenses of

Rent $380

Utilities $170 aprox. with no cable

Phone $40

Groceries $150

With the last two that I keep current, this brings me to $930 a month, so about $270 left over for whatever might come up, as well as I pay my family as much as I can each month.

I can't see how I can settle $20,000 in debt with the $200 or so I'd have left over each month. And even if I could, it seems like it would take forever and I wouldn't get a chance to pay my family back for a long time. With BK, I can focus all my extra money each month into paying them, and then getting back on my feet.

Any advice is appreciated.

[LadynRed]

Oh, you certainly have more expenses than that ! Everybody dloes. Do you take a bath and use deodorant ? Do you wear clothing, surely you WASH them ? Do you pay car insurance ? Do you pay for oil changes and tires on your vehicle ? Surely you put gas in your tank You need to consider ALL of your normal living expenses.

While that doens't seem like a lot of debt, at your income level it could take you the rest of your life to pay it and some of those creditors you quit paying WILL sue you. I would suggest you call for a couple of consultations with bankruptcy attorneys.

Keep in mind that you MUST complete the (stupid) "credit counseling" before you can file ANY bankruptcy and you must do it within the 6 months prior to filing. It's usually no more than an hour on the phone, internet or in person.

[IslandGirl]

I never chime in on this board because I am a big newbie and this is all still very new to me but I was in a similar situation and I thought I would give you my thoughts..

Lady's advice is right, it would benefit you to meet with a BK attorney and get a professional opinion and they can advise you as to what you should do.. I too had been laid off and fell way behind on rent, car note, etc. I tried everything I could to stay on top of the bills (even went as far as to pawn sentimental items, pay day loans, etc) and after finding this board and learning about other's experiences I finally met with an attorney who was able to advise me on my options and future... My new job, while great, had a salary that was half of what I was making the year before and I was looking at $28k in debt and only making ten grand more that that a year - after I had exhausted all efforts I could think of to keep my head above water I realized I needed to file Ch 7. Each individual is different so maybe there's a chance you could avoid that route, but for me filing meant realizing I was in a situation I could never dig myself out of alone so as tough as it is I think it was the right decision.

I think you'll find no one is pro-bankruptcy because it is tough, humbling, limiting, I could go on and on.. But had I not filed I would have been facing garnishments, lawsuits, collections and wrecked credit - not to mention the horrible emotional toll and loss of sleep that it was already begining to take.

Sorry about your troubles, keep digging around on this board it's really helpful, and meet with a legit attorney in your area that specializes in BK and then look at your pros and cons..

Congrats on your raise - hopefully it means things are turning around for you!

[movingbackwards]

Thanks for the replies

I don't have too many more living expenses, since I sold my vehicle in Dec. and simply walk to work every morning. BK is def looking like the best option.

LadynRed, you said I can take the credit counseling over the internet as well? What does that usually run moneywise, and what site would you suggest? Thanks again for the help.

[answer2prayer]

I found some very interesting and educational information at the 2 websites below, they might be helpful to you too...

http://www.bcsalliance.com/index.html

http://bankruptcy.findlaw.com

Gives you info on filing yourself and also a search for attys in your area.

Hope this helps.

[AISLE4]

I think you'll find no one is pro-bankruptcy ...++

[thomassl]

Thanks for the replies

I don't have too many more living expenses, since I sold my vehicle in Dec. and simply walk to work every morning. BK is def looking like the best option.

LadynRed, you said I can take the credit counseling over the internet as well? What does that usually run moneywise, and what site would you suggest? Thanks again for the help.

I would look on the home page of this site under the "New Bankruptcy Laws". There should be a site with a listing of approved places according to your zip code. I referred a friend to the site when she was considering bankruptcy.

[LadynRed]

There are only so many APPROVED credit counseling firms blessed by the DOJ. You'll have to choose one of those. I've no idea of the cost, I think it varies as some may even use a sliding scale based on your income.

http://www.usdoj.gov/ust/eo/bapcpa/ccde/index.htm

As for your living expenses, I think you'll find you have much more than what you think. We ALL underestimate them - until we actually keep track and write them down.