student loan

[sleeplessinohio]

Hello everyone,

I've been reading as I can over the last week or so and am so grateful I found the forum. Thanks to everyone who takes the time to respond to questions posted.

We have an upcoming appointment to speak with a bankruptcy attorney, but would appreciate any insight you could offer.

I have so many questions.

My husband lost his job. The chances of him finding another job at his salary are nil. We cannot survive on my salary.

Our biggest debt is my student loans. I've been paying on them for the better part of eight years, but the principal is still well over 70K.

I know that student loans are not forgiven. But, is the total amount due ever reduced?

Also, we have good credit. We are not behind on any bills and have never had late payments. Our car loan and our mortgage are at higher than average interest rates. I want to phone the banks and see if they will work with us. But, do we have to be late first? It seems like everywhere I read, homes are in foreclosure before help is available. Should we try to negotiate ourselves? We also have an appointment with a legitimate consumer credit counseling place at the end of the month. Should we wait and let them negotiate or advise us?

IF we could refinance our car and home to a lower interest rate, I believe we could continue to pay those bills without any problems.

*whew*

Anyway, sorry to be so long-winded. I have so many questions and concerns that I don't really know where to start.

Thanks in advance for any information or experience you can provide. Perhaps, someday, I'll be able to return the favor for someone.

Sleepless in Ohio

[MajorMike]

Hello there,
Welcome to BK forum! Everyone here is very knowledgable and helpful so don't be shy!
In your case, since you have such great credit, you should try to re-finance your interest rates. Have you consolidated your student loans to a lower interest rate? Also, as far as those credit counseling companies, Please don't get persuaded by them. They will promise you the world only to leave you in worse shape then a bankruptcy. Go get 3-4 consultations from attorneys in the area. If you're husband isn't working, you may qualify for a Chapter 7 but you need to place time in between the last 6 months of his employment and your date of filing. Once you decide to file, you will cease making payments on your unsecured debt ONLY. Make those student loan payments though as they will survive the bankruptcy. You haven't said how much unsecured debt you have in order for us to evaluate whether it is worth filing a BK over.
Let us know and someone else will certainly chime in with more advice for you!
Best of Luck!
MM

[helpless]

Where are you at in Ohio? If you are in COlumbus, PM me and I will give you the name of our attorney.

[sleeplessinohio]

Hello MajorMike and helpless,

MajorMike, our unsecured debt is about 35K. Really? We should avoid the consumer credit counseling place?

May I ask why we'll need to wait for six months after my husband's unemployment to file? Is there somewhere on the site I can read more about this?

I did consolidate the student loans and they're at 6% with SallieMae.

Gosh.. so many questions.. one more? Please?

You say we should try to re-finance with the banks. Is this something we can do on our own, or should we ask for help from the attorney or consumer credit counseling company? I keep thinking they'd have more experience and better success than we will.

Thanks again for any information.

Sleepless in Ohio

[CindyLou]

You should see a BK attorney ASAP for a free consultation...actually see a few.

Unfortunately, chances are if your income has decreased dramatically since you purchased your car and your home, chances of refinancing at a lower rate may not be too good.

If you don't mind me asking, what is are the rates on your house and car? Welcome to the forum. I think you will find that you will get some honest and caring answers to your questions.

[MajorMike]

Hello MajorMike and helpless,

MajorMike, our unsecured debt is about 35K. Really? We should avoid the consumer credit counseling place?

May I ask why we'll need to wait for six months after my husband's unemployment to file? Is there somewhere on the site I can read more about this?

I did consolidate the student loans and they're at 6% with SallieMae.

Gosh.. so many questions.. one more? Please?

You say we should try to re-finance with the banks. Is this something we can do on our own, or should we ask for help from the attorney or consumer credit counseling company? I keep thinking they'd have more experience and better success than we will.

Thanks again for any information.

Sleepless in Ohio

Ok, your student loans are at a good rate then. If they are Government loans, you are stuck. If they are private loans, you could have a chance at discharge but you need to google that one because I'm not sure. Your attorney nor credit counseling will help you with the interest rates without a price. The credit counseling companies will get them lowered but you'll be paying through them and then they don't pay on time which hurts you. You may as file Bankruptcy and be protected by the automatic stay. The reason I say you should wait the 6 months, is because you had 2 salaries and now you have one. When they look at your income, they take the last 6 months average and use that for your means test. The lower the income, the better for you, because then you could qualify for a chapter 7 instead of having to pay through a chapter 13 plan.