Just stop paying credit cards "NOW"?

[7issoscarry]

Hello all
I'm new here and need some advice.
We went to our BK lawyer today.
He looked over all our paper work and said we need to file Chapter 7.
We are not behind on any bill and have a high credit rating but our income is disappearing due to the economy.
My wife and I are self employed photographers.

My Lawyer said starting today
STOP PAYING ALL CREDIT CARDS!
Does this sound right?
Jim

[beyondtherapy]

more important that stop paying all credit cards is stop USING all credit cards. if you've never made a payment, it is a good idea to pay at least the minimum due for two months to show good faith intent to pay back the debt. but as a general rule, follow your attorney's advice.

[7issoscarry]

We haven't used our cards in 10 months except to transfer a $18,000 balance from a card that suddenly changed our very low rate to 18% for no reason, this was about 45 days ago.
Will this balance transfer be a problem?

[7issoscarry]

bump

[Calamity]

Our situation sounds very similar. We have a high credit score and are not late on payments on anything. We have robbed from Peter to pay Paul. The debt councilor we talked to and our attorney have both advised us to focus on the house, vehicles and utilities and stop paying the unsecured debt.

In our case (and I am sure in yours too), there is no possible way to pay the mortgage and vehicle loans and keep current on the unsecured stuff without putting us deeper in debt. At first I bulked at the advice, but now I understand it's what we have to do to not make the situation worse than it already is.

[7issoscarry]

Hi Calamity
It's really hard after a lifetime of building a high credit rating to just let it go and stop paying but after living of the edge for a while I know there is no way we can survive if we don't make a change.
Our lawyer just laughed when he seen our tax return for last year it was below poverty level. He feels confident Chapter 7 will be the way to go.

[Calamity]

Hi Calamity
It's really hard after a lifetime of building a high credit rating to just let it go and stop paying but after living of the edge for a while I know there is no way we can survive if we don't make a change.
Our lawyer just laughed when he seen our tax return for last year it was below poverty level. He feels confident Chapter 7 will be the way to go.

I know EXACTLY how you feel. Our credit scores are something we've worked hard on and are proud of. I've never had to borrow and cent from anyone, because I've always been able to take care of myself. I just keep telling myself that allowing the debt to accumulate and discharging even more than I already am is worse for me and for my creditors. I don't want them to have a bigger loss than they already will have - I feel horrible about that.

[7issoscarry]

I agree.
Perhaps taking the first steps are the hardest.

Have you stopped making payments on your credit cards?
This is going to be a hard step for me.

[hamburgervol]

My attorney said the same as well. No point in making any further payments since you plan on discharging the debt.

[7issoscarry]

Have you stopped making payments yet?

[LuciluS]

We haven't used our cards in 10 months except to transfer a $18,000 balance from a card that suddenly changed our very low rate to 18% for no reason, this was about 45 days ago.
Will this balance transfer be a problem?

Our Attorney recommended we pay the minimum plus $25-$50 on the specific credit card where I had made a balance transfer. He said quit paying all the other credit cards. This was back in Sept. as we thought we would be filing Dec. or Jan. Now, we will be filing in 9/09.

Did you tell your Attorney about the balance transfer? If not, maybe give him/her a call & see what the Attorney recommends in the case of the transfer.

Luci

[7issoscarry]

We did tell our attorney and he said pay on this card for another 4 months so they won't be able file a complaint.
So you haven't been paying any other credit cards since Sept 08?
Has the other credit card companies backed off on calling?

[SCorpPain]

We haven't used our cards in 10 months except to transfer a $18,000 balance from a card that suddenly changed our very low rate to 18% for no reason, this was about 45 days ago.
Will this balance transfer be a problem?

From what I have read it is possible that it could be an issue. You might need to make minimum payments on just that card for a few months, and then file. Let any other unsecured debt go. But ask your attorney, he/she will be your best source on that question.

It is hard to do; my credit rating was 760 before I launched a business. The business has taken a dive due to the economy and I cannot keep up any longer. All of my personal debt is fine, but like many entrepreneurs I had to use my personal credit history to start the company.

After a couple of months of nasty calls you will start growing thick skin. One thing my attorney said was to not promise that you will pay. Also, he said to just hang up when they get too pushy, which they will do quickly.

[hamburgervol]

Have you stopped making payments yet?

I have.

[LuciluS]

We did tell our attorney and he said pay on this card for another 4 months so they won't be able file a complaint.
So you haven't been paying any other credit cards since Sept 08?
Has the other credit card companies backed off on calling?

Once we paid our Attorney $300 (he is paid in full now) he told us we could give his name & phone # to the CCs who called. We thought we would be filing by Jan.09. However, after reading this forum, Attorney overlooked some monies I was receiving on a 401k plan which ended Feb. 09 due to the market tanking.

Phone calls started again in late Feb. early Mar. I answered them and told them I had skin cancer (no lie) & would be having surgery in late March & until I got the 'all clear from my doctor' we wouldn't file until then.

Two weeks ago, I did speak to a lady from Asset Recovery. Can't remember which CC she was calling about, but it was in my name only. She was quite rude. I told her my only income was Social Security Disability. She said she would run an Asset on me. I told her do what she had to do. Gave her my Attorney's name & phone # and hung up on her.

We've received 4 collection agency letters and of course monthly statements. Our Attorney told us to ignore them. If they filed suit in Court he would file something (I forgot the name of it) to delay it until we had time to file on 9/30/09.

He also said don't answer the phone if you don't know who is calling. The lady from Asset Recovery's phone number came up as a cell phone # with an Area Code of Dh's uncles home. That's why I answered that call.

We get all kinds of phone calls, but none are leaving messages. As to our relatives receiving phone calls, we've not heard of any types of those phone calls.

Hope I helped you a bit.

Luci