What can they do to me?

[doron]

Here's the situation: about 80,000 in CC debt. Self employed, currently almost no income. Realize from reading the forum that two money gifts I got (and used to pay bills and CC) count as income - and put me over the maximum allowed for chapter 7.

I rent. I have 2,600 left in the bank.

So...I don't think I can pay the 1,600 CC due this month. Meaning, I will have to file bankruptcy (but it will take me time to do this because I know nothing about it).

What happens if I'm not eligible for BK but simply don't have money?

And what happens if I simply don't pay my credit cards? I feel sick over this. What will they do?

[btbeme]

First things first. You are not alone. Believe me.

Second - take a few minutes and run your numbers through the Chapter 7 means test, available at the Nolo website and many others. Google it if you need to. Chances are, if you rent, have expenses, are not currently running up credit cards, you will pass. Even if you do not, take step 3 below.

Third - call a few attorneys in your area. Not one - a few. Set appointments, walk in, and level with them. They can help. Find one that speaks to you (you will know what I mean when it happens). I talked to about a dozen before I found one that saw things through my eyes. Don't stop talking to attorneys until you find one that you are comfortable with.

Last - stay on this forum. Even if you file by yourself - no attorney - you can get help here.

Chin up. Bankruptcy is there to help you, not end you. Trust me. You have no reason to, but trust me. And do what I - and countless others - have done. Take the first step. And then the next.

[btbeme]

Second reply...

We are not covered by Shaira Law, so they will not take your hands or head. We are not in Mexico, so they will not toss you in a cell and bill your relatives to pay your debts to free you. We have no debtors prisons. Worst case is that your name will appear in the smallest possible typeface in a section of the newspaper that nobody reads anymore. And that only happens after all your debts are discharged and you are free to go about your life like millions of others do.

Did you know that over 30,000 people file bankruptcy every day?

Yes, every day.

And nobody loses their freedom if they are honest when answering the trustee's questions and filling out their paperwork.

The rest is just "stuff", and you probably won't lose that, either.

[frogger]

Here's the situation: about 80,000 in CC debt. Self employed, currently almost no income. Realize from reading the forum that two money gifts I got (and used to pay bills and CC) count as income - and put me over the maximum allowed for chapter 7.

Self employed, currently almost no income? Then there's no real big hurry to rush and file bk. Use this time to study, learn, and plan. Give those two money gifts time to age away.

Welcome. You're among friends here.

[music12]

you're getting great advice above. nothing will happen to you if you miss your cc payments this month. if all you have is $2600, what can they do? nothing!

it sounds like if you wait 6 months these gifts will fall off your income and you will be able to file then. if you do that (and not pay your cc's in the meantime), the worst that can happen is that your cc's will either sue you (though they usually wait a lot longer than 6 months to sue, so read about other people's experiences on this forum), or charge the debt off and sell to a debt buyer who may then also sue you (again, unlikely within such a short timeframe). then if they sue you and get a judgment against you, they can seize your bank accounts and garnish some of your wages. but again, this takes a long time and i'm sure you can file before any of that begins to happen.

good luck.

also, you may be already eligible to file if you play with the means test and have a good lawyer.

[doron]

Thank you

Thank you for your responses.

OK, I've always paid my bills on time, always, always, you see, so this is hard. So most people stop paying CCs and after a while file, rather than the reverse?

I'm thinking of asking a friend for about 600 dollars so I can get through till the end of the month and pay the credit cards. Then I'll have another month to go to credit counseling and figure this out.

I don't think I could afford a lawyer, and my understanding of these matters is close to nil. I'd rather do nothing for a while and avoid conflict with the CCs.

Is that a good or bad idea? To try and pay the CCs?

Should I try and call them? I read somewhere that's a bad idea.

[HHM]

Thank you for your responses.

OK, I've always paid my bills on time, always, always, you see, so this is hard. So most people stop paying CCs and after a while file, rather than the reverse?

I'm thinking of asking a friend for about 600 dollars so I can get through till the end of the month and pay the credit cards. Then I'll have another month to go to credit counseling and figure this out.

I don't think I could afford a lawyer, and my understanding of these matters is close to nil. I'd rather do nothing for a while and avoid conflict with the CCs.

Is that a good or bad idea? To try and pay the CCs?

Should I try and call them? I read somewhere that's a bad idea.

Reality check, YOU CANNOT AFFORD YOUR CREDIT CARDS, so continuing to pay them is a non-starter. Nothing particularly dire is going to happen over the next 6-8 months if you stop paying your CC's today.

With that amount of debt, Bankruptcy is in your future regardless (short of winning the lotto). Time to start planning and learning. Even if you cannot afford an attorney now, go meet with some to get a "real" idea of how much it costs and assessment of your situation.

[lrprn]

Is that a good or bad idea? To try and pay the CCs?

So you borrow money to pay the cc's this month. What are you going to do next month, and the month after that, and the month after that?

If you can't afford to pay the cc's and your other debts and living expenses now and you can't increase your income or reduce your expenses enough to pay the cc's and everything else on just the money you bring home, then you have your answer. It's a bad idea.

The advice you've received already is excellent. Plan this bankruptcy. There's no rush to file. Almost all of us here stopped paying all our unsecured debts like cc's for months - sometimes years - before filing. Your phone will ring off the hook, and you'll get threatening letters - that's all. You have at least 4-5 months before cc's get serious about collecting the debt.

Should I try and call them? I read somewhere that's a bad idea.

Trust me when I say that cc companies hear a thousand times a day whatever story you are going to tell them. They don't care. They just want their money.

If you are considering credit counseling, for 95% of people, working out a deal with unsecured lenders like cc's doesn't work out in the long run. First, most lenders won't even talk to you until you are months in arrears. Second, whatever they are willing to forgive you likely will have to pay taxes on - the IRS considers whatever is forgiven as income. Third, there's nothing to compel lenders to work with you - it's completely voluntary. Some lenders won't agree and will continue to harrass you for full payment.

Set up free initial consultations with at least 3-4 experienced bk lawyers in your area. I think you're going to find out that bankruptcy is your only real alternative for the best long-term outcome.

We understand the shame you feel about finding yourself here. That's why bankruptcy exists legally - to help you gain a fresh start and use the lessons learned to never find yourself here again.

And if that doesn't do the trick, start reading the posts here that share what happened when members tried in good faith to work with their cc companies. They ended up throwing away thousands of dollars trying to work with them and ended up filing bankruptcy anyway. I know this because that's exactly what happened to us.

Don't allow your emotions to drive your decision-making. Think like the cc companies do. Cold, hard, emotionless facts. You owe more than you can pay. Examine all your options, then do what's best for *you* in the long run.

[momofthree]

FYI, there is something called an "insider payment." If you pay a friend or relative within 12-24 months before filing (can't remember which), then the bk court can go after that friend/relative and take them money back from them to distribute to your unsecured creditors. So, borrowing money from friends/family is NOT a good idea because you won't be allowed to pay it back until after discharge.

[doron]

"Reality check, YOU CANNOT AFFORD YOUR CREDIT CARDS, so continuing to pay them is a non-starter"

You're right.

I guess I keep hoping I will find a job (it's possible) and then not paying will just make things worse (increased APR, fines).

Also - you'll probably laugh at this - but the one credit card on which I owe 40,000 has been nice. Kept their APR low for years, lowered the limit once but no more. I don't use it, except last month I had a sudden need to use it. I feel it's unfair towards them. OK, laugh...

I know you're all right...it's just hard, being someone who never blows off bills. It's like jumping off a cliff.

[doron]

There were a few responses posted before I replied.

OK.

I get it.

If I borrow money from a friend (I don't know if they'll want to) it'll be to pay living expenses.

That's it.

It's sinking in...

[momofthree]

There were a few responses posted before I replied.

OK.

I get it.

If I borrow money from a friend (I don't know if they'll want to) it'll be to pay living expenses.

That's it.

It's sinking in...

Make sure the friend is aware that you are contemplating bk and may not be able to pay them back until after said bk is discharged--possibly up to a year down the line....If you think there is ANY chance you may end up filing bk, don't pay any money back to friends/relatives or the trustee will come after them...not a fun situation for anyone involved.

[doron]

Yes, I got that, thanks!

I wouldn't borrow from anyone who needs the money to live on. I think if anyone will lend me several hundred dollars, they won't expect it back.

[ready2puke]

Your self employed? So am I and am under the impression that 1: no one can garnish any wages from you...
2: You don't have to take the "means" test if your self employed...as long as you barely pay your bills, living expensives, etc.. with little money left over...your fine.
Good luck.
I haven't paid anyone if almost 2 years now still calls but no action

[ready2puke]

Also I don't think the 'gift' is a biggie since your not buying luxury items and just trying to live..Its NOT considered a creditor if its a gift..JMHO