Question about income

[NissanMan]

I have one collection agency who is saying his client wants him to sue. Right now I take home about 950.00 every two weeks and my bills are below.

250.00 truck payment
117.00 insurance
50.00 student loan (loan in my name)
150.00 student loan (in my dads name but my bill)
55.00 cell phone payment (contract in her name
20.00 a month for medicine

Also on top of that I have things such as clothes, gas, food, and some entertainment with gf. I also have about 16,000 in credit card debt. I mean sure I have money left over to pay creditors but with the 30% intrest rate and added over the limit fees and late fees the money I could pay wouldnt make a difference and they refuse to work out anything.

Also I do want to move out with my gf but if I pay the creditors I wont have money to live together with her.

I have heard that on your means test you can really stretch out your bills. I am also wondering since I still live at home if I couldnt list down that I pay rent to my parents each month in the amount of 75.00 a week or 100.00 a week.

I am not trying to avoid responsibility but I was dumb when I was 18 and dating and also trying to go through school with a part time job. I really want to be debt free and start something of my own but I will never pay these creditors off at there rates, fees, and unwillingness to negotiate.

If I move out I am looking at the following bills below.

Rent 550.00
power about 100
water about 25
cable about 40
gas about 50

plus all the other bills above. So from what I said you can see where I am coming from about being stuck if I dont do bankruptcy and how I cant make it on my own and will be throwing money away by trying to pay creditors.

[keepmine]

From the bills you list and your income, you have plenty of money to pay creditors.
IMO, $16K just isn't enough to file bk over with that sort of disposable income. Stop using those cards and start budgeting your money. You'll spend +$1k in legal fees and filing fees. That could make a serious dent in those debts.

BTW, what do you mean by stretching out your bills via the means test?

[NissanMan]

Well it is true I have money to pay them but when you add that I pay about 150.00 a month towards gas and then extra towards food I still have money left over but with the fees and intrest rates they are charging, paying them just doesnt seem to make sense. I would keep them happy with payments but the balances wont go down and my hopes of getting my own place are unrealistic.

Also what I meant about stretching the means test is that I have heard from here of people adding dry cleaning, vehicle repair, and other various little things.

But for example Bank of America wants a minimal payment of 156.00 a month and with the fees and intrest I need to pay something like 166.00 just to break even.

Also I no longer have the cards. I havent charged to a credit card in over a year.

[keepmine]

Many of us filed on debts that are a multiple of $16K. Me, I filed on $71K worth of cc's . At the time, I made abut $35K and had far more fixed expenses than you have. Had I thrown out the anchor at the $16K mark, I'd not have filed.
Yes, you can claim ordinary living expenses in your schedules but, once you stop paying those cards, the income you used to pay the cc debt will become dispsable income and you'll likely be forced to file a Chapter 13.
You didn't get in this mess overnight and don't expect to become debt free overnight as well. Keep living at home and cut back on your social life and get this debt under control.
Frankly, I think you're better served by finding a good personal finance forum where you can get some help with budgeting.

[yomama]

You don't sound like you're very old? My husband doesn't even bring home as much as you do and he's 54. We did everything we could absolutely do before we filed for bankruptcy as far as trying to pay off the debts. We thought we could do it going through a debt negotiation company, but then he lost his job and we couldn't make our payments anymore. If our debt had only been $16,000 like yours is and we had quit charging years ago (it took us probably 20 years of charging to get $50,000 in debt), we could have managed to pay them off, but once you're up as far as we were, it's pretty much impossible to do that unless you're making a LOT more money than what we were.

Can't you sacrifice some things to put more money towards paying off your credit cards?? People have to make choices and give up some things. We no longer go out to eat, and we never did buy a lot of clothes. I'm lucky if I get a new outfit twice a year, same for my husband. One pair of shoes last us at least a year.

If you file bankruptcy and still don't learn to budget, I'm afraid that you might just end up in the same shape that you're in right now. Not to be mean, but $16,000 isn't really that much to go bankrupt over. We filed with $60,000 in unsecured debt plus my husband has $20,000+ in school loans (we couldn't discharge them, of course) and a $350/mo car payment.

I can understand your wanting to be with your girlfriend. Does she have a job? If so, then if you really feel the need to find a place together, I think you could make it go and still pay on your credit cards. Wouldn't she be able to help with the expenses?? With your small debt and as much disposable income as you have, I hope you don't expect to do a Chapter 7. You have enough for the trustee to make you pay creditors on a payment plan.

Are you aware of the fact that after you file BK you can't file for another 8 years? If you file now and something happens in that time period that you can't pay your bills, it will be 'Tough luck Charlie.' Save the trump card for a dire situation, give up things, and budget.

[NissanMan]

It isnt that I cant pay. It is that what amount that I can pay will not make a difference. When the accumulated intrest and over the limit fees are more than the minimal I am stuck in a trap that I will never get out of. I mean I want to pay them all off. I know student loans are not dischageble but I owe about 15,000 there and I owe about 10,000 on my truck. I only recently got my job making about 950.00 every two weeks and now that I make enough I want to move out on my own. I just realize though that when I do get out on my own I will only have enough to make minimum payments and the minimums do not bring the balances down at all but they keep going up and I have tried negotiating and that gets nowhere and I tried credit counseling but a couple of the creditors refused. I figure if I can get my balances discharged it will make things much easier to where I can save money and I will avoid credit cards. I have learned credit cards can be ok in an emergency only but I am the type to use cash. I believe if I cant pay with cash I dont need it.

I am going to talk with an attorney but I have been reading the bankruptcy courts automatically allow certain amounts for food, clothing, and other items. I also will post that I pay rent weekly to where I live. And also I work about 18 hours overtime every two weeks and I will just completley stop the overtime to make my income much lower. After a while from discharge I will just start to work the ot again.

[CATCHMEIFYOUCAN]

You do what you think is best, At age 25-26 I filed for BK on $13,000 because it really overwhelmed me. If you negotiate with creditors for a lower payback, you might get a 1099 (i think its called) and owe taxes on any part of the debt forgiven ! Bk is the better way to go (to me) at first you will have to go through a Credit Counseling Service (they usually determine if you can pay back a certain amount on a monthly payment plan and negotiate a lower interest w/creditors - if it shows you are unable to pay back a certain amount than you will get a certificate and move onto the next step - BK !

Good Luck, Catchmeifyoucan

By the way . . Im not 25 anymore and am 39 .. I did a dumb thing with my new found credit between the ages of 25-39 and ended up filing BK, this one was needed as I got discharged on $65,000 .. so whatever you decide BE CAREFUL !

[SinkingFast]

As others have said, your level of debt to income ratio is really rather low. You bring home, Net, about $7500/yr more than you owe to CC's. Most people posting here filed BK on debts that far exceeded their Gross/yr.

To "padding" or "stretching" expenses on the Means Test,......... It ain't gonna happen. You'll get the Schedules Allowables for your area and that's it.

The only place you'll get more $$$$'s on the Means Test is if you have a car payment that's way more than the Vehicle Allowable. And remember, your current car payment is gonna be amortized FORWARD over 60 months. If you're on the front end of a 5 year loan, you'll fair OK. If you're toward the middle or near the end of your car loan, your payment amount is gonna be less on the Means Test than you actually pay/mo.

You can do whatever you want, Nissan,............ But, honestly, I'd suggest you give paying down the debts the old college try first.

[tay666]

Ok, let me see if I have this straight.
Tour monthly bills are less than one 2 week paycheck.
Which leaves you an entire 2 week paycheck left for other things like CC payments and food, gas, etc.

I understand what you are saying about interest rates and fees eating up most of your payment, and the balance not coming down much.
It does seem hopeless.

How many cards do you have?
If more than one, is there any chance you can concentrate all your extra cash into paying off the lowest one?
Have you been getting any other CC offers in the mail?
You might find one that will let you transfer the balance of your worst card onto something with better rates that will let you pay things off.
At the very least you need to send one of them a chunk of money to get yourself under your limit. Just getting that over the limit fee to stop kicking in every month will help a lot.
Have you checked at any local banks? You might be able to get something like a $1000 personal loan. The rates would be better and the payments would be smaller, and you could send all of that to one of the cards to whittle away a chunk of it.

What I am saying is you still have a lot of options.
If you put everything you have into getting these paid, it will pay off.
And once you start making progress, it will snowball. More and more of your payments will come off balance on the cards, and less will go towards interest. But for that to happen, you have to send more than the minimum.
That is the trap. the minimum payment won't make much progress at all.

BK is a big and drastic step.
What you owe in CC debt in total is less than what I owe on 3 different cards (each one is around 20,000). My wife and I combined don't make as much as you do, and we have a house and 2 kids.