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What would you do if you were me (looking for opinions on debt situation)


MonkeyWrench
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I wanted to get some opinions on my situation.

 

I'm a NYS resident. I owe about $50K in a combination of credit card debt (Citi, Chase, Discover, HSBC, Bank of America) and a personal loan through a local credit union. There is really no chance that I will be able to pay it off or even settle as even settlement would add up to an amount I am not able to produce. As of now, all of this debt is several months old without payments on my end.

 

On top of that I have about $20K past due child support (which through personal agreement with ex I continue to pay in smaller amounts than stipulated by court, but nonetheless official amount overdue is about 20 grand)

 

Being up to my neck with day to day life and helping take care of my child I really have no room for playing endless games with the creditors. I have read up on the subject as much as possible and responded to some CAs with DV. I'm ok with filing bankruptcy on the credit cards and the loan (provided that I can) as I don't own any assets. Would filing chapter 7 be the best option here? After researching this board and other places, I get the feeling that being dragged through arbitration or whatever else may be over my head. If I start going that direction and figure that it is too much, can I still file chapter 7 at some later time or am I closing that option for myself if I take steps with arbitration or whatever other approaches? 

 

Any suggestions appreciated

Thanks

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@MonkeyWrench - I would try avoiding filing bankruptcy unless you absolutely have to.  Absolutely have to in this case would be if a creditor tries to sue you or you feel you would lose in court.  If you file a BK, your credit will be tough for 10 years.  If you don't file, it will be 7 years that your credit will be affected.  

 

I would just let these debts go to collection, don't answer the phone and wait and see what happens.  You always have the BK card to play at a later date.  Your circumstances could change and It would be a shame to file too early.  If you just want to get things over with, file the BK.  Do you pass the means test? 

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@MonkeyWrench - I would try avoiding filing bankruptcy unless you absolutely have to.  Absolutely have to in this case would be if a creditor tries to sue you or you feel you would lose in court.  If you file a BK, your credit will be tough for 10 years.  If you don't file, it will be 7 years that your credit will be affected.  

 

I would just let these debts go to collection, don't answer the phone and wait and see what happens.  You always have the BK card to play at a later date.  Your circumstances could change and It would be a shame to file too early.  If you just want to get things over with, file the BK.  Do you pass the means test? 

I'm at the borderline with means test. My straight income should qualify me but occasional extra few hours don't make it easier. 

 

I'm currently looking at Discover "attorney placement pending" letter (I've seen others face the same issue on this board). I'm only at about $1500 on that card. should I try to arbitrate? If I do, does that close my option for BK later if it looks like things are not going right and I need to file?

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Who is the OC on that card? If Cap1, then yes. they might sue. If some of the other banks, they are more likely to pass off to a JDB first where you could make a deal. At the JDB level with enough persistence, you could settle that for $500 or less.

 

If you're referring to the $1500, it's Discover. The debt is still with them (OC)

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@MonkeyWrench

 

Identify each account when it exactly went into collections. Always know when you know you will be out of SOL. Ny has tough tough laws. you may be able to get out sooner.
Take a chance and move out to a different state from New York!!!!!.

Second, take a hard look at each amount. Settle only in writing only when you know you have MONEY!!!! not borrowed or loaned from friends and relatives.

Save all correspondences/letters to a file where each account has its own cover for correspondences. Change your address to a POBOX. Notify each collections about it. or in your correspondences to DV. Change the telephone number to your EX (just kidding) on your credit report or a find a fax number that you identify with in your correspondences.

Have your credit report display all your telephone numbers and dispute the one you have now!!!!. most likely it will be taken off (atleast how I know Transunion took it off for me).

Never miss sending out a DV to each of them in due time. Only the first communication in the first 30 days of receving letters CMRRR matters.

If you get sued, contact a NACA lawyer and look for on their documentation filed with courts if a full Social Security # has been displayed. Interview more than 4 NACA lawyers./Craigslist Lwyr

Do not ever accept anything less than " dismissed with prejudice" . Anything less is just not winning. Capital One may just do that. Even ask for your 3 year tax returns thru lawyers.

Never get scammed for anything in and after four years from the DOFD/Chargeoff date to start new trouble again!!!!. YOu will never get off it.

However little money that you have, if you can open a secure Credit Card account by all means open one and manage it well. My suggestions r for MerrickBank and USAA secure cards. (low annual fees).  

Never never never never never never make any any any I mean NONE PAYMENTS to collection accounts no matter what they entice you with!!!!!...ABSOLUTELY POSITIVELY NEVER.

 

 

Monkey Wrench, I have lived your life and it is more frustrating than you will ever know but after a few years it just becomes easier and easier. I have gotten away with $105k by handling the accounts versus giving in to collections. Once my 7 years were over no one ever cared to find where I was or what I was upto and I had credit cards and loans and everything. its a game. Must be a player!!!!!. if you aint made for, you will be suckered.

 

BANKRUPTCY AT ANY AGE NEVER PAYS!!!!!!!...ITS NEVER IN YOUR BEST INTEREST UNLESS THE AMOUNT OWED AND DEMANDED IS OVER A CERTAIN AMOUNT. TO ME ITS ATLEAST 200K.

 

PLEASE DO NOT FILE BANKRUPTCY its not worth it!!!!!!.. it will be stinking for a lifetime!!!!!!. people say they recover from it and get cards and all but in employment you will always be screwed. it will be very hard to do business or find employment with bankruptcy.

or for that matter

if you are on SSI or Disability or Welfare programs, you will forever not recover. !!!!!!!! just my own opinion.

 

BEEN THERE DONE THAT

 

 

 

 

 

 

 

 

 

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Take a chance and move out to a different state from New York!!!!!.

 

NOT good advice.  Until legal residence is established the NY SOL will apply.  Depending on the state moved to that could be 6 months to a year.  Not to mention if the OP is already in debt the expense of moving is not a good idea either.  They have a job and are established.  Taking a risk on giving up a good paying job to move is a bad idea.

 

Do not ever accept anything less than " dismissed with prejudice" . Anything less is just not winning.

 

While anything less is not winning to you that isn't the case for everyone.  I got a JDB removed from all 3 CRs and an agreement to no longer pursue collection all while avoiding court all together.  For me that is a win.  

 

I have lived your life and it is more frustrating than you will ever know but after a few years it just becomes easier and easier. I have gotten away with $105k by handling the accounts versus giving in to collections. Once my 7 years were over no one ever cared to find where I was or what I was upto and I had credit cards and loans and everything. its a game. Must be a player!!!!!. if you aint made for, you will be suckered.

 

You got lucky then.  These days the OCs are holding on to debt and several of the OPs are known for not selling and for suing.  While what you did worked for you it may not be for everyone.  Not everyone is prepared to live with 3-6 years of collection calls, dunning letters, and threats of lawsuits.
 

BANKRUPTCY AT ANY AGE NEVER PAYS!!!!!!!...ITS NEVER IN YOUR BEST INTEREST UNLESS THE AMOUNT OWED AND DEMANDED IS OVER A CERTAIN AMOUNT. TO ME ITS ATLEAST 200K.

 

This is NOT true and you know it.  While you may not see BK as worthwhile it has helped MANY people start over when over whelmed with debt beyond their control.  While your threshold for filing suits you each person is different.  Each person considering BK should and must speak to a qualified BK attorney to look at all their circumstances to determine if BK is a reasonable and the best option for them.  NOT make a decision based upon someone else's criteria, EVER.
 

PLEASE DO NOT FILE BANKRUPTCY its not worth it!!!!!!.. it will be stinking for a lifetime!!!!!!. people say they recover from it and get cards and all but in employment you will always be screwed. it will be very hard to do business or find employment with bankruptcy.

or for that matter if you are on SSI or Disability or Welfare programs, you will forever not recover. !

 

THIS is NOT true at all.  BK only affects employment if you are employed in the financial sector and financial stability is a requirement for the job and/or regulatory agencies that require licensing or bonding of employees.  In fact Federal Employment law makes it illegal to discriminate against an employee for filing BK.  Most employers do not even bother to check a CR for hiring.

 

Recovery from BK takes a year or two but with each year that passes the sting is much less.  All while you can be rebuilding a credit history LONG before you can with brand new defaulted debt that can be sued.  Many people prefer to clean the slate rather than live with the stress of collections and lawsuits.  While you may not prefer to file belittling someone who legitimately may have to doesn't help.

 

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I definitely do not recommend anyone file bankruptcy unless the amount is so high that its unbearable!!!!. You have a long life to live and you can only file so often a bankruptcy. I only believe filing bankruptcy once in a lifetime!!!!!!. if it ever ever becomes EXTREMELY NECESSARY!!!!. What life may throw at you in your lifetime is not something I know but having a bankruptcy may hinder for a long long time to come. I do definitely believe that. Its just my opinion. We all have to move on with or without bankruptcy. Its years later is when it really comes to haunt you that you should/or shouldn't have filed bankruptcy.

 

As for moving, people do move for better life/better opportunities and carry their debt anywhere in the United states they go!!!! .It pays to DISCOVER. THE (JOB) THAT GIVES YOU BACK your life.   So I would definitely suggest people move if their situation/circumstances permit!!!!. People specifically move to texas and establish residency here within a YEAR of staying in Texas.  

 

Accepting anything less than " dismissed with prejudice" when you are sued only makes matters worse!!!!! You got lucky that a JDB rmoved from all 3 CR's. I happen to find that I was owed money over and beyond what I was due to bank OF AMERICA just becoz that had lousy paperwork and wanted to be rid of the lawsuit.!!!!!! I just not only had my tradeline deleted but instead of paying the JDB. Bank of America upon Suing I recovered money back that I paid my attorney and my attorney got his attorney fees? it all depends who you get as your attorney.

 

As to employment, most employers today do a background check on you and besides criminal/drug testing there is also this question on employment application

 

In the last xx years, have you ever filed for Bankruptcy? Yes or No. If yes when?  

and if you mention when? its over Clydesmom? You don't want battle you just want to work and disclose what it is? factual.

and it also holds true when applying that they want to know if you have applied or received benefits from Social Security TANF or disability or workers compensation? Believe me its just not restricted to financial/sector/institutions.

 

Clydesmom all I care about is having a good life!!!!.. free of worries!!!!!. I speak from experience life sucks when bankruptcy/debts/collections are hovering over your personal life.

Even Divorces/ WOMAN/girlfriends think twice before associating with you if you carry bankruptcy!!!!!! on your CR.  LOL. just aint worth it!!!!!!!

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@monkey Wrench

 

Attorney placement Pending is just a threat that will sue you!!!!. its just not a suit on file with the courts. Its their way to make you rush to pay with a court threat!!!!. find out if its FDCPA violation?

 

Energizer, I recognize this is a threat at this point and believe me I'm not running for the checkbook. What I do need to know is, in people's experiences, what are the chances that this threat will turn into an actual legal action. If there is something I could do now to prevent that then it may be in my best interest to take those steps. 

Thanks for all your feedback and sharing your experiences

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Energizer, I recognize this is a threat at this point and believe me I'm not running for the checkbook. What I do need to know is, in people's experiences, what are the chances that this threat will turn into an actual legal action. If there is something I could do now to prevent that then it may be in my best interest to take those steps. 

Thanks for all your feedback and sharing your experiences

Just hang on. First and foremost PAY ON YOUR CHILD support, failure of that will result in much more dire consequences than not paying a loan or credit card, IE (Jail time, loss of driver's license, which can cause loss of job, etc).

You can't be put in jail for CC debt or lose your license!

 

If you don't own property or if you are underwater on a property you do own, the most they can do is get a judgment and put a lien on the property, which won't mean much unless you sell, then they can collect from the purchaser, which will cut any profit (if any) from the sale.

 

If you are way underwater, just keep the payments up and if you ever have to move..............just walk away, more and more are finding this the only way due to the massive fraud in the mortgage industry.

 

If you are on SSI, SSDI, or receiving a pension,  or under (I think) a certain income level in some states, those cannot be garnished under law.

 

Most judgments can be removed in bankruptcy if you have a good attorney, so fighting a defensive retreat can be a good thing.

 

Save your money up for an attorney if needed LATER, pay your support and move on. Even if your wages are garnished, I believe that most states don't allow them to take over 25% at max from your pay, but this is something to worry about much later down the line. If you work for yourself..not much they can do.

 

You will probably find that some stiff resistance on your part will pay off in the end, save the BK nuke for later. But that  is your choice

 

BK is itself very, very stressful unto itself and then the worry afterwards is itself stressful.

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@MonkeyWrench

 

Believe me the threat is nothing compared to defaulting on child support? do any and everything necessary to be up to date on child support!!!! that failure can be devastating.

 

Other than that, any government taxes/liens are priority. Pay it upfront. or make payment arrangements.

 

Then comes every other debt!!!!!

 

DONT WORRY BE HAPPY!!!!. IF YOU WILL CHEER FOR YOURSELF FOR WHAT YOU HAVE you will cheer when its all over with? and it will be over with!!!! this time will pass too

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