brownsfan12

110K in Unsecured Gambling Debt **HELP**

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Hello All,

I have made some extremely stupid decisions this past 2-3 years and it has left me in a huge hole that looks impossible to get out of and I am looking for advice or any suggestions on what to do.

I have been a gambling addict for the past 2-3 years and as of 2 weeks ago have finally confessed to this and I am now seeking help and have been free for 18 days now, this is my current financial situation:

Creditor Name Payment Due Date Original Loan Amount Current Balance Monthly Payment Percentage of Debt Interest Rate Loan Term (Months)
  • Disover Card
  • 2nd
  • $0.00
  • $2,334.20
  • $69.00
  • 2.11%
  • 23.24%
  • N/A
  • Chase Card 0872
  • 15th
  • $0.00
  • $2,630.00
  • $26.00
  • 2.38%
  • 15.24%
  • N/A
  • Chase Card 6214
  • 24th
  • $0.00
  • $3,002.00
  • $30.00
  • 2.71%
  • 18.24%
  • N/A
  • Paypal Credit
  • ?
  • $0.00
  • $3,500.00
  • $0.00
  • 3.16%
  • ?
  • N/A
  • CitiCard 0534
  • 1st
  • $0.00
  • $6,923.74
  • $101.00
  • 6.26%
  • 28.99%
  • N/A
  • CitiCard 1857
  • 17th
  • $0.00
  • $7,995.00
  • $119.00
  • 7.22%
  • 28.24%
  • N/A
  • Bremer Bank
  • 1st
  • $0.00
  • $8,036.83
  • $164.00
  • 7.26%
  • 24.24%
  • N/A
  • OneMain Financial
  • 1st
  • $10,000.00
  • $8,825.51
  • $314.89
  • 7.98%
  • 21.94%
  • 48
  • Lending Club
  • 1st
  • $20,000.00
  • $16,779.0 
  • $804.54
  • 15.16%
  • 25.88%
  • 36
  • Prosper
  • 1st
  • $20,000.00
  • $17,088.9
  • $697.33
  • 15.44%
  • 15.41%
  • 36
  • SoFi
  • 1st
  • $35,000.00
  • $33,543.5
  • $589.58
  • 30.31%
  • 10.88%
  • 84

This is a breakdown of my monthly Living    Expenses:

              Item:                                    Monthly Expense

  • Charity                                       $240.00
  • Housing                                   $1,414.92
  • Utilities                                     $501.97  
  • Food                                            $306.00
  • Transportation                   $1,353.09
  • Clothing                                    $50.00
  • Medical                                    $290.00
  • Personal                                  $280.00
  • Misc. Items                            $75.00
  • TOTAL:                                  $2,915.34

INCOME:

$5,766.00 Monthly Take home pay.

As you can see I have a total monthly debt/expenses of $7,437.92 with only an income of $5,766.00.

I have $11,000.00 in savings, and I am debating between using this 11k to pay off some of this debt, but even if I do I still cannot meet the monthly min. payments. So I am also considering to stop all of the payments on my unsecured loans and save approx. $1,600 ea month and use this and the 11k as a potential settlement 6-9 months down the road once these accounts go to collections.

My other option (I think) is to file for Chapter 13 Bankruptcy, but I'm not sure that I would qualify because of my income.

Any help or suggestions would be greatly appreciated.


Thanks!

 

 

 

 

 

 

       

 

 

 

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There are many fine consumer lawyers  in OH.  I would contact several to discuss your options.  There is no charge for an initial evaluation and no obligation.  But you do need to move on this.

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17 hours ago, brownsfan12 said:

I have been a gambling addict for the past 2-3 years and as of 2 weeks ago have finally confessed to this and I am now seeking help and have been free for 18 days now

First off good for you for recognizing you have a serious problem and dealing with it.  

17 hours ago, brownsfan12 said:

My other option (I think) is to file for Chapter 13 Bankruptcy, but I'm not sure that I would qualify because of my income.

Do not assume you won't qualify.  At least speak to two or three attorneys and discuss your situation with them before you make any decisions.

Here are three things I see that you can do in the short term that would free up a decent chunk of cash from your budget:

  • Charity                                       $240.00

I am all for charity but when you are this mired in debt you need to stop this contribution immediately.  There are many ways to contribute and volunteering your time and skills is a great one until you get back on your feet.

Utilities                                     $501.97 

If any portion of this is cable or satellite and you are not in a contract cut the cord until you get this under control.

  • Transportation                   $1,353.09

If this is ONE car payment:  YIKES.  If it is more than one see if you are not upside down in the loan(s) I would sell one of the vehicles and get a much cheaper paid for utilitarian car that will get you around safely without costing a fortune to pay for, maintain, and insure.  That amount should be no more than half what it is now.

I don't know what your personal and miscellaneous expenses are but if you looked at where that money is likely leaking out (trips to Starbucks, fast food etc.) you can likely reduce it by half.  If you looked at those few areas you could potentially free up as much as $1200 a month which might help you avoid filing bankruptcy and not defaulting on anything.

 

 

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Thank you for your insight, I really appreciate it!

13 hours ago, Clydesmom said:
  • Charity                                       $240.00

I am all for charity but when you are this mired in debt you need to stop this contribution immediately.  There are many ways to contribute and volunteering your time and skills is a great one until you get back on your feet.

 
 
 
 
 
 

Thank you for this feedback, I agree that I need to donate more of my time and less of my money... 

13 hours ago, Clydesmom said:

Utilities                                     $501.97 

If any portion of this is cable or satellite and you are not in a contract cut the cord until you get this under control.

 

My Utilities do not include Cable or satellite, but it does include $280.00 for Verizon (1 line ($151) is the grandfathered unlimited data plan that we use for our home internet, as we do not have other viable internet options and I need it for my work).. Here is a further breakdown.

Utilities Verizon Wireless (Internet) $151.38
Verizon Wireless (Phone) $129.72
Electric $150.00
Culligan $43.77
Kimble (Trash) $13.10
TMK (Propane) $14.00
13 hours ago, Clydesmom said:
  • Transportation                   $1,353.09

If this is ONE car payment:  YIKES.  If it is more than one see if you are not upside down in the loan(s) I would sell one of the vehicles and get a much cheaper paid for utilitarian car that will get you around safely without costing a fortune to pay for, maintain, and insure.  That amount should be no more than half what it is now.

 
 
 

Yes, Transportation is definitely a YIKES! Here is a breakdown showing the "upside down" value on both vehicles, I have been contemplating using the $11k in savings to pay down on both and try and sell, I think I can sell some "Stuff" and have a garage sale and come up with an additional 3k for a total of 14k, but I will need to have money to cash off a beater car/truck so that I have transportation.... 

Category Name Original Loan Amount Current Balance Monthly Payment Current Blue Book Value Difference
Transportation Bank of America (Car) $31,360.31 $26,714.81 $539.14 $18,000.00 -$8,714.81
Wells Fargo (Truck) $19,727.25 $13,824.37 $339.28 $9,000.00 -$4,824.37
Gas Truck     $175.00    
Gas Car     $140.00    
Travelers Insurance     $109.67    
Vehicle Maintenance     $50.00    

 

I really appreciate your feedback!

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2 hours ago, brownsfan12 said:

Verizon Wireless (Phone) $129.72

If you are not in a contract I would consider dumping this plan and switching to a cheap burner cell phone with a defined amount of data and possibly cut this number in half until you get ahead.

2 hours ago, brownsfan12 said:

Verizon Wireless (Internet) $151.38

Check into Virgin Mobile and a couple of other providers that offer one of those "fobs" that you connect to a USB port and you get internet that way through the satellite.  There may be a cheaper unlimited option.

2 hours ago, brownsfan12 said:

I have been contemplating using the $11k in savings to pay down on both and try and sell

Seeing the breakdown I might consider leaving this alone even though it is a HUGE expense.  If you were to pay down one it would be the truck and then sell it for blue book value simply to get out of the payment.   Discuss this with a financial adviser or BK attorney first though as this may not be your best option.

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If you end up defaulting on your unsecured debt, these are the ones I would worry about the least:  Citi, LendingClub, OneMain & Paypal.  The reason is because they have arbitraiton clauses in their contracts and they don't like to actual use arbitration.

Discover has an arbitration clause, but they are more aggressive and will follow you through arbitration.

Chase has no arbitration and can likely get an easy judgement if they end up suing on a defaulted debt.

I am unsure of the remaining creditors.

I agree with Clydesmom that you should at least talk to a couple BK attorneys through a free consultation before you write that option off.  Most people are surprised at the amount of exemptions that are allowed in their state.

Good luck!  If things get too dicey for you, there will be many people here who can help you find the answers on how to deal with it.

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Talk to a BK lawyer.  Now.  Before you go late on any of your debt, because many lenders will work with a BK, but 20 or 30 late payments on your credit report will tank your score for the next 7 years.

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As someone who faced a gambling problem in the past, and who also filed pro se chap 7 BK; I commend you on recognizing that you have a problem, gambling addiction is truly a insidious addiction.  With that amount of debt, I would really would look at filing BK, depending on your level of income and other factors you may be able to file chap 7.  I dont know if you mortgage or rent, but most of the time you are able to keep your house, and the state and federal exemptions can protect most of your liquid assets.

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Hello All,

Huge THANK YOU to all that have responded, the overall consensus that I got was to see a BK lawyer and I just finished doing a free consultation and it was great, here is what I have decided to do, in this order:

1. Being that I am upside down by 8.7k on my F-150 and 4.8k on the car I am going to call each creditor and surrender both vehicles.

2. I will then buy (1) 4 x 4 SUV for 7k and (1) car for 4k paying cash for both (using our 11k in savings)

3. I will then file for Chapter 13 BK, being that 4k is exempt for each vehicle I will only have to figure 3k as equity instead of 11k, plus I now have (2) vehicles that are paid for!

4.  I will have a Chapter 13 monthly payment for approx. $1,700 for 5 years for a total amount of $99,000 (102,000 - 3,000 for lawyer fees) paying off debt of $123,000.00 which isn't a huge difference but having the peace of mind that I'm not going to get sued or wages garnished and harassed by creditors is worth it, in my opinion but what do you guys think?

I have one final question: I am currently late on (7) of the (11) unsecured debt by 20 days, is it in my best interest to be current on these debts even if I file for chapter 13?  I know that Chapter 13 will damage my credit report but I would rather just have (1) bad report rather than (7) additional "late" reports, but I wasn't sure how that is reported.

 

Thanks for your help!

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53 minutes ago, brownsfan12 said:

4.  I will have a Chapter 13 monthly payment for approx. $1,700 for 5 years for a total amount of $99,000 (102,000 - 3,000 for lawyer fees) paying off debt of $123,000.00 which isn't a huge difference but having the peace of mind that I'm not going to get sued or wages garnished and harassed by creditors is worth it, in my opinion but what do you guys think?

I actually like this plan.  It allows you to have control of the situation without the stress of waiting for lawsuits or garnishments to land.  Especially considering OH has one of the longest SOLs to sue and on judgments.  The most important thing is are YOU comfortable with it because you have to live with it?

55 minutes ago, brownsfan12 said:

I have one final question: I am currently late on (7) of the (11) unsecured debt by 20 days, is it in my best interest to be current on these debts even if I file for chapter 13?  I know that Chapter 13 will damage my credit report but I would rather just have (1) bad report rather than (7) additional "late" reports, but I wasn't sure how that is reported.

Double check with your attorney but once they accounts are included in BK I don't think it makes a difference but your attorney is in the best position to advise you on whether these should be caught up first or simply wait and file.

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43 minutes ago, Clydesmom said:

Double check with your attorney but once they accounts are included in BK I don't think it makes a difference but your attorney is in the best position to advise you on whether these should be caught up first or simply wait and file.

 

Thank you, I will do... Aaahhh the freedom of being free from the Gambling, and a plan to resolve this debt is exhilarating!!

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6 hours ago, brownsfan12 said:

I have one final question: I am currently late on (7) of the (11) unsecured debt by 20 days, is it in my best interest to be current on these debts even if I file for chapter 13?  I know that Chapter 13 will damage my credit report but I would rather just have (1) bad report rather than (7) additional "late" reports, but I wasn't sure how that is reported.

The three different attorneys I talked to back in 2010 said it's much better to have no lates showing on your report when you file BK, for exactly the reason you mentioned.  That's how my sister did it and she had a 700 FICO in 4 or 5 years post-BK.  Again, that was 2010, so maybe the lates on accounts that have the 'included in BK' flag are weighted differently now.

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 Hello All,

Just wanted to ask if anyone has any experience with settling on debts that are only 80 days past due?

I have a Lending Club debt with a balance of &16,800.00 and I was curious what my chances were of settling that debt for 12k to 14k with it being only 80 days past due?

Thanks,

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