On my way to #7

[Blue_Ray]

We're on our way to file chpt 7, but before we do, we need to wait till were at least 7 months behind. All I know is I am going more into debt w/ my bank over draft protection. So I was told by my attorney to stop making all payments on these CC's. Also I cannot pay them anymore b/c we have a new born and we will have to afford a daycare, and w/ all the CC debt we cannot do it. So its one or the other. So you get the idea.

Anyways, we like to know what kind of tips on "WHAT TO EXPECT" on our way for this 7-month journey to not paying these unsecure credit cards anymore?

What all did you do when the creditors called, what did you say to them? Did you even answer the phone?

Thanks for any heads-up!

Cheers,
Ray

[Blue_Ray]

FYI - we are in about 37K of unsecure CC debt. Now I am sure it will be climbing once I stop payments and start seeing attached late fees on the bills.

[follie]

Can you tell a little more about your situation? Why do you need to wait 7 months? Do bills automatically debit from you checking account? If they do, I would either have that stopped immediately or open a new account somewhere else.

Welcome to the board and congrats on the new baby!

ETA: I went more than a year not paying on my CCs with no problems, other than some phone calls. I would screen all of my calls anyway, so it was no big deal. I have about 50k in unsecured debt, so I feel your pain.

[SinkingFast]

Start saving all your statements from the CC's as the bills come. That's just a CYA in case you get asked to show statements to the Trustee.

Also, save any other correspondence you get from your Creditors. Collections letters and such. Your attny will want all addresses for every Creditor to list in your BK petition. Including 3rd party collections companies acting on behalf of the original Creditor.

Personally, I'd suggest you save receipts from all purchases. That way, if you spend more in a category than the Court is used to seeing, you have proof.

For example medicals. You said you just had a newborn. You may well spend more on medicals than the Court is used to seeing. You're gonna have check-ups and vaccinations at various intervals for the next year or 2 that can easily add up to more than the average person spends.

So pick a spot now to start stashing all that stuff.

Don't answer the phone. It's not worth the time. Collectors have heard every sob story out there. They aren't interested in why you can't pay. They just want money. Some are nice people but most aren't. Many threaten, abuse, and harass you over the phone. No need to subject yourself to that.

Get an answering machine or look at your caller ID to screen whether you wanna answer the phone or not. If the ringing bothers the baby, turn the ringer off when you don't wanna hear it.

[CindyLou]

First and foremost......GET YOUR MONEY OUT OF YOUR CURRENT BANK and open another account while you still can. If you file BK and owe your current bank money for overdraft protection they can take your account. If you have a clear bank record, go to another bank where you are sure you do not have a credit card with them or an affiliate...regional banks are the best and open both a savings and a checking. It will be hard to get either right after or during BK....

[Blue_Ray]

Thanks all

[manglicmot]

I answered my phone and told my creditors that I was planning on filing Chp 7 and they stopped calling. If you avoid them, they will make efforts to contact you and start callling other people, like work and relatives. It's best to tell them you plan on filing to avoid all that.

[Walnut]

Get an attorney and retain him/her - then give the attorney's number to the creditors when they call and the calls will stop. Again though - why are you waiting 7 months? Do you need it to pass the means test (we did)? Is it because of a major purchase or cards getting run up?

[Blue_Ray]

Can you tell a little more about your situation? Why do you need to wait 7 months?

I guess it b/c when you file, they look at 7 months worth of income. The income in the past 6 months is over the median income for chpt 7 here. Now, since wife was laid off, but landing another job and getting less, we need to get that 6 months worth of income to show what we make pur regual bills, but not these unsecured cc's. I was told to do this.


Do bills automatically debit from you checking account? If they do, I would either have that stopped immediately or open a new account somewhere else.

I dont have setup for auto debit from our bank account. We just switched on checking acct w/ a credit union that does not have any trends w/ the credit cards, but the bank where our new bank is, we have a auto loan with. Is this ok? Am I safe to open a bank account w/ our auto loan is at??


Welcome to the board and congrats on the new baby!

Thank you

ETA: I went more than a year not paying on my CCs with no problems, other than some phone calls. I would screen all of my calls anyway, so it was no big deal. I have about 50k in unsecured debt, so I feel your pain.

Bring them, all they will get is Mr. Answermachine.

All posted above

[Blue_Ray]

Oh yea, now stopping all credit card payments, we can now save about $1100 a month . That was what we were paying a month of CC's. Should I just put this money into savings?? Tips??

[keepmine]

That $1100/month needs to go to living expenses, legal and filing fees. You need to take care of things like dental visits, new glasses, any needed medical tests or procedures. Auto repairs, home repairs,etc. Also, ask your lawyer about exempt assets like, IRA's. Don't file with money in the bank beyond what your state exempts.

[SinkingFast]

That $1100/month needs to go to living expenses, legal and filing fees. You need to take care of things like dental visits, new glasses, any needed medical tests or procedures. Auto repairs, home repairs,etc. Also, ask your lawyer about exempt assets like, IRA's. Don't file with money in the bank beyond what your state exempts.

Dittos.

You'll think you're gonna have an extra $1100/mo, but you won't.

Think about all the things you should have been paying cash for that you probably charged without thinking about it.

Groceries, gasoline, doctor's visits, RX's at the drug store.

Also, think about the things you put off because you "couldn't afford" to do whatever.

Dentist, eye doctor, car repairs, home repairs, buying clothes, and such.

7 months sounds like a long time, but it's really not. It'll take you at least 2-3 months to adjust to paying as you go. And you'll need a bit to figure out what your real expenses truly are.

Don't forget to budget for things that come once or twice a year on a monthly basis as well. Auto insurance premiums. Life insurance premiums. Homeowner's/Renter's insurance. Those types of things.

[DeadManCrawling]

Should you ACTUALLY have $1100 a month left over, you will be pushed for a chapter 13 and have to pay for 3-5 years. My advice would be to do as others suggest and find all the things you have neglected and spend that money as it comes in. Dental, medical, eyeglasses, vehicle and home repairs.

If you put it in savings or kept it on hand, the BK trustee would take it from you. Best to do a little thinking about all the things that have suffered because of the large bills. Use that money wisely to correct those things, and make sure you don't let it pile up, if it is in fact there.

I personally would keep a small emergency fund in cash, just in case.

Stock the freezer and pantry. Load up on necessities, not luxuries, and you should be okay.

best wishes,

-dmc

[Blue_Ray]

WOW! Thank you all again.

Ok, well one thing we always never could afford was daycare. Daycare around here shoots for about $600 a month. Which we never got, and my mom always been there to help, but could not even pay her. Now times changed. Shes tired and wants to travel. I have no help other then that. Wife worked nights I worked days. We never saw each other, basically if we paid for daycare, it would be for only 4 hrs at most, not including my sons afternoon out of class care. None of that we could afford, now it looks like I know where to put my funds at.

Hell I don;t even know the last time I even visited a dentist. Wife been nagging for new glasses.

My son has allergies, and his advril cost $75 for 2 week supply which we been putting off. I do have a little cafeteria plan, but its only $50 a year. I just really, really could not afford much. As for cars? hahahah... Looks like I need to get them spark plugs and transmission flush. Home repair, yep, need a new roof and trim work. House is starting to rott on the outside. Hummm... Ok, I got the idea. Thanks all, I have a strong idea to know what I need to do. God Bless you all for your HELP'Z

[Blue_Ray]

Oh yea.... so just get these done and keep receipts, right?