filing seperate

[purpledaisy1005]

Ok i think My Husband and I have come to the conclusion that CH 7 is going to be what we need to do. We will probably file in about 7 months to let the income go down because i will only be working Part time after next month. We live in tennessee he has 14 credit cards that add up to $15,000 in debt and some other things that are all in his name only. He makes $22,000 a year.

I have 4 credit cards and some loans that are in my name only and they are all about $4000 in debt. My credit right now is pretty good and we can afford to contiune to pay mine I will only make about $500 a month after next month.

His car is one that after looking at kelly blue book may be worth 1500. its paid for and in his name. We do not own a home we only rent, My car however is in my name but im having to pay my dad back for it and its kelly blue book is bout $7000.

My question is should he just file alone with out me. I know our income is well below median he just has more debt by himself than we could ever pay off and if we file together then my car is worth more than our exemptions i know they would take it.


My hopes are he files all his debt gets discharged. we then just get my debt paid down and keep my credit good.

Anyone else file seperately? How did it go? Anyone from Tennessee? thanks

PS can they MAKE us file together?( we wont have money for a lawyer til closer time to file.)

[keepmine]

Honestly, I'd not file over $15K. Post bk, you can't support a family on $22K. Your big problem is not debt, it's lack of income. I'd go work on getting a better job, or, picking up some pt work before I played the bk card.

[FreshLikeADaisy]

Purpledaisy, they can't MAKE you file together... unless you're in a community property state, where you pretty much have to file jointly anyway because all debt incurred during the marriage is considered to be joint debt. I can't remember if Tennessee is a community property state... sorry.

BUT, I have to disagree with Keepmine on the amount filed over. If you only make $22k and owe $14k, that's 64% of your annual income and hellishly hard to *ever* pay off, which is where I think bk is a legitimate option for you. If you are otherwise good (for instance, you have low housing costs because you live with family, etc) it is not unheard of to live on $22k, just difficult. He's certainly right that at some point you will have to increase your income, and I agree you have a problem there, but I'm familiar with Tennessee, particularly eastern Tennessee, and in some places $22k is great wages. So keep in mind that you only get to file bk once every eight years, maybe longer depending on how the laws change between now and then, and decide according to the totality of your circumstances.

Also, many bk attorneys offer free consultations. You can go to a consult or three *now*, and decide if bk is really right for you based on the specifics you give the atty, instead of waiting several months only to find it isn't actually what you need. In any case, good luck!!! I really hope it works out for you.

[purpledaisy1005]

Thank u. Also I was wondering if anyone reading this wouldn't mind sharing, but have any of u ever got to the point where u stopped paying ur credit card bills and got sued by the creditor? If so I was wondering how long it took, or what the shortest amount of time aand which creditor worked so promptly. I know every case is different I just was wondering when to expect the big bad wolf to come knocking

[gophermn]

I stopped paying on my rental house August 2007 and credit cards late September 2007 and no lawsuits here. And I just filed last week (long story there) so I can personally say I went roughly 4 months with no lawsuits.
If you are joint on any of those credit cards your credit will get dinged. Question I have for the forum group is what if you are married filing seperate - Will your spouse's credit get dinged as well?
Good luck!

[Lindsay]

Chase sued just over three months after last payment. My lawyer couldn't believe it when we showed him the lawsuit paperwork (they sued us on Halloween - Trick or Treat!). He said usually it doesn't happen for at least 9-12 months. The other ones have been calling and making collection attempts but no other lawsuits so far. We'll be filing in the next month though now so they won't have time to get a judgement. We answered the summons, asked for verification, and so far we haven't gotten a court date from Chase.

I probably wouldn't file for $15,000 either, but as Daisy pointed out, its a huge mountain of debt with such a small income. We live on a small income right now too (until I get my degree in May and then our income should be higher when I quit eBay and work a normal job) so I know how hard it is. By the time I buy food, pay the car and house payments, gas for the car, and some of the utility payments, there is nothing at all left. There isn't even a penny left to pay for unsecured debt. I haven't had a haircut in 2 years, eat ramen twice a week (the other days its mac & cheese,spaghetti, burritos or soup) and haven't bought any new clothes in several years. I have gotten really frugal and thats somewhat empowering, but scary.

Now that the credit card accounts are delinquent over 6 months, some of our creditors have offered good deals on settlements. Some haven't offered to work with us (HSBC collector wasn't helpful and suggested we file for BK), but Bank of America offered us a settlement on our $8000 account of only $1350! Discover will settle for 30 cents on the dollar now. I wish we had the money to settle with all of them and avoid a bankruptcy, but we really don't right now. Our debt is $80,000. After your husband is seriously late on some cards, some of them may offer some good settlement offers that you may be able to work out.

Most creditors won't sue very fast, so you have some time to think about things and consider your options.

As far as your husband filing separately, alot of people do that. Unless you are in a community property state, you should have no trouble at all. I think thats a smart decision to keep the credit of one spouse clean if its possible.

[keepmine]

The problem with filing on a small amount of debt coupled with a low income is, it really does nothing to solve longterm financial issues.
On 14 cc's and a total of $15K, that's barely a grand a card. Minimum payments are in the $10-15 range.
I'd make a fight out of it before I dinged my credit with a bk that is likely unneccessary and just a bandaid solution to a longerterm problem. You'll spend in the neighborhood of $1500 on legal and filing fees. That will make a signficant dent in that debt. Couple that with your tax refund plus,the anticipatd tax rebate and 6 months of pt work and the debt issue is on the way to a resolution.

[purpledaisy1005]

Thank u for the advise, all. Hey lindsay how much did u owe chase when they sued? Was it a regular credit card or a store card. We have a rooms to go card and chase finances it. Its at 3500 and then I believe our circuit city card is chase too and its 1500. We won't ever be getting another credit after this is over. Cost of living must be really low here cuz 22,000 pays our bills with the exeption of his card debt. I just need to work part time to get my debt paid down. 15,000 is a lot to us because the payments on these are a little over 600 a month and we are behind on 2 of thoses by 2 months one card miniumum right now is 280 for all the fees and the other one is 205 and all the other cards are following shortly. We will not be able to get caught up. I don't have a sitter for my little girl to work more than part time and that's just to pay my debt I still feel filing seperate is best

[larryg]

Just a suggestion!!!!!!!!! If you want to try and work with the debt. Call the CC companies and get your minimum payments down. Of course how helpful this is depends on your interest rate. Discover jumped my min pymt to 4%, I called them and told them I couldn't make that payment and they brought it back down to 2% and told me I could keep my low interest rate. I recorded the name of the person I talked with and watched my accout closely. Sure enough the next month they listed me as a late payment, higher interest rate, and late fee. I called them back and told them who I had spoken with and what our arrangements were and they credited the late payment and extra interest they had charged me. Put my account back where it should have been and only a 2% payment.
Obviously, if I had panicked and not called them they would never have corrected this problem on their own. I have a 5.9 rate on this loan and they were much happier with 21%. CC companies know that most people think they have to pay what they are told and never make the calls. Plus they have the advantage on the phone that it takes 20 minutes to an hour to even get to the point of talking to a person. Very hard on the average working person.

[Lindsay]

Purple, we owed Chase $5800 on the account we were sued on. We have a second Chase account with an $8500 balance that we stopped paying at the exact same time. They haven't sued us on that one yet. It makes me wonder too. You think they would have sued with the larger one first or sued on both of them.

Like I mentioned, our lawyer said that he's never had any client sued in that fast of a timeframe. If you are current now, you definitely have a while before they'd take legal action and there are ways to stall them if you do get served. If you file for BK, it will stop any lawsuits from creditors. Alot of people who file BK wait until they get sued until taking action on filing.

[keepmine]

Thank u for the advise, all. Hey lindsay how much did u owe chase when they sued? Was it a regular credit card or a store card. We have a rooms to go card and chase finances it. Its at 3500 and then I believe our circuit city card is chase too and its 1500. We won't ever be getting another credit after this is over. Cost of living must be really low here cuz 22,000 pays our bills with the exeption of his card debt. I just need to work part time to get my debt paid down. 15,000 is a lot to us because the payments on these are a little over 600 a month and we are behind on 2 of thoses by 2 months one card miniumum right now is 280 for all the fees and the other one is 205 and all the other cards are following shortly. We will not be able to get caught up. I don't have a sitter for my little girl to work more than part time and that's just to pay my debt I still feel filing seperate is best

The mistake that many people make post bk is, they settle for the status quo. They think that all of lifes problems are solved by wiping out debt. Frankly, $22K does not pay your bills or, you would not have $15K worth of cc debt.
You 2 need to get realistic about your finances or, a year or 2 from now you'll be right back in the same shape but, you'll already have used the bk card. On that sort of income, you'll never be able to own a home or drive a car less than 10 years old. I doubt you're contributing to a 401K or, have an IRA. Low paying jobs will affect your life 30 or 40 years from now when you retire and have no retirement savings and with less money withheld for SS, that means a smaller SS check.
You have to start thinking long term.While bk is not the financial death sentence it was 15 or 20 years ago, I think all of us would prefer not to have filed. Me, I was making about $35K and filed on $71K worth of cc. Paying off $15K would be a breeze had I stopped at that level.
Again, your biggest problem is not the debt level but, the lack of income.
If you're only 60 days late, contact those creditors and ask about a hardship program. I'd suggest trying a lot harder to work this out. After all, bk will still be there if it's just not doable.