Trying to clean up my credit again

[lillymarlene]

I know I have posted about this before, but I'm still trying to decide what to do. I completed a 4 year Chapter 13 about 5 years ago. Then around the beginning of 2017, I lost my job. I spent about 6 months bouncing around temp jobs, then finally I got 2
positions one cashiering for a major retailer and the other in a large warehouse. Both are part time and unfortunately, don't hire full time. Then later, I started collecting my social security. My income with all streams combined is now about $3,100 per month. So now I can breathe a little easier, but while I was unemployed, I had to stop paying a lot of bills and fell behind on my mortgage. I'm now caught up on house payments, but of course it's still been one thing after the other. I've been through about 6 junk cars, and now have one, that I paid outright for, that I hope is a little better. I need major repairs on my home, but right now I wouldn't qualify for an equity loan. I need hearing aids, but they are so pricey. My state supported healthcare has stopped (too much income and age) and I have terribly expensive prescriptions, $700 for a 90 day supply. I hope to cut down the hours that are all over the place, on the department store job, so I can get some sleep.

Then yesterday, I got my credit report. Not really as bad as I thought, but I owe about $6,200 in mostly credit card bills. I also have an old Verizon bill for about $160. Somehow or other it wasn't on the report. I know I probably owe the city about $3,000 in water/sewage bills. (I don't believe that's forgivable in bankruptcy.) My mortgage still has about $28,000 left on it. I hope to either stay in my house or move to an over 55 mobile home community.

Does this seem too little to go bankrupt over? Would I be better off trying to settle with these creditors, there is about 6 of them. I'm not sure exactly how I would settle, and the amounts they claim I now owe, are greatly inflated. Please help point me in the right direction, so I can just move on.

[justbroke]

Hey lillymarlene. It's a tough position and I ended up filing again (mostly because I never got rid of the IRS tax debt which killed).

As for your city water/sewer bills, they are dischargeable. They are treated like any other creditor unless the bills "run-with-the-land" and are some sort of tax. I discharged a little water, some electricity and a cell phone. So utilities are fair game.

I think your problem would be the equity in your home. That is likely to keep your from filing unless Massachusetts has a good homestead exemption and/or the federal exemptions help. So you're really only about $9,000 in debt as I don't count the mortgage as unsecured debt.

It's a tough call, but maybe in your particular case, debt management may work. The debt management companies may be able to negotiate down to 30% (of $10,000 is $3,333) and maybe pay that off over 3-5 years at $56 to $95 a month. (I don't know a lot about debt management so I'm making pure guesses! Just trying to illustrate some options.)

So your options, debt settlement (yourself), debt management/settlement (through a company), and/or bankruptcy.

As a side note, with $700/month prescriptions, that's a significant amount of money. I have nothing to do with the following company, but please try to see if Prescription Hope can help you. My friend uses is for a $600/month drug (120 doses/month) and pays $50/month to Prescription Hope and they "technically" handle all the paperwork to get it for free directly from the pharmaceutical. It can takes 2-3 months to get it all situated, but it's worth it in the end.

[sophieanne]

justbroke - I just looked up Prescription Hope..they look like a good option for people to look into for those unbelievably high priced medications. Good Rx is another good potential site. I’ve personally learned that going to a manufacturer’s site can offer discounts that a person may not be aware.lillymarlene - i hope you find the solution to your financial issue that works best for you.

[justbroke]

Good Rx is good for a discount, but Prescription Hope can get you either co-pay or $0 on the non-generic (brand name) drugs (plus the $50/month fee they charge to help offset their costs). So $600/year is much better than $600/month (at least for my friend).

[lillymarlene]

Thanks sophieanne and justbroke for your help. I'm thinking I may look into debt settlement again. Right before I filed Chapter 13, I found a place that had a good reputation. They told me to go with bankruptcy at the time, since I had about $250k in debt and with my income it was just too much. Hopefully the place is still around.

Then I'm not sure about my water bill. Some time ago, I believe the city put a lien against my property. I'm not sure how I would go about looking that up and how I could pay it off without selling my house, or get it removed.

I'm afraid if I don't do something soon, I'll have a couple of these people getting a judgement against me, and garnishing my wages. I sure don't want my jobs to find out.

I'm also looking into medical gap insurance or "Advantage Plans" and "Extra Help" from my state. The trouble with many of the insurance plans is often my expensive medication is not on their formulary. The prescription insurance I have now covers the medication I've been prescribed, which also has no generic. Some of these plans try to force people into cheaper medication, but it may not be as good as what I presently have. I've had no side effects, and many of these drugs are loaded with side effects. I have Stage II COPD. Btw, the amount I have to pay is $700 for a 3 month (90 day) supply.

[flashoflight]

The water bill is dischargeable, but it will become a lien on the house.

If you just started Medicare within the past six months, there are a whole lot of options with traditional vs HMO. After that, you are stuck with whatever you chose. But I'll just cut to the chase. I think Medicare Advantage plans are garbage and you should choose Traditional Medicare with a Medigap G policy which will virtually guarantee you never have copays on anything other than drugs. But that's only available on initial Medicare enrollment without medical underwriting. If you can get Extra Help, that will help a ton on Part D. One trick is to use old unpaid medical bills to become Medicaid eligible for one month and then that will trigger automatic Extra Help from Medicare so you don't even have to apply for Extra help to get it. Make sure you go through step therapy on the cheaper stuff so you can become eligible for the more expensive drugs.

[lillymarlene]

Yes, I'm afraid of those Advantage Plans, that I wouldn't be able to get my prescriptions. $700 every 3 months is a discounted rate, because I have prescription insurance without it, it would be close to $1,600.

[Carmella]

Yes, I'm afraid of those Advantage Plans, that I wouldn't be able to get my prescriptions. $700 every 3 months is a discounted rate, because I have prescription insurance without it, it would be close to $1,600.

I would be weary of the Advantage plans or Medicare replacement plans as we call them at work. They have some perks for some people, but they also are a product trying to be sold and you loose some traditional Medicare benefits. This is based on my work experience not on my actual use of Medicare I still have several years before I will be on Medicare, but I have friends who are that age. Some of these replacement products have you waive your Medicare benefits forever. I would not like that! Some you can switch back at the beginning of every month and some have an open enrollment period.

Gap insurance is different it covers things that Medicare does not or if you have a responsibility to pay 20% they pick it up. That's not a bad thing to have, but with all policies try to read it/understand it to the best of your ability. It's always hard to know what's the real story versus what they are trying to sell.