New to all of this, HELP!!!

[BkClueless]

A little about our situation,
We are 10,400 in debt and we went to see an attorney and he recommended chap 7 for us. He said it would be quick and easy but that it will cost $1,5000, which we obviously do not have right now.
We were wondering if there are any placed that do it for cheaper other than the scam sites that state the will file it for a few hundred bucks.
Is it very hard to file for yourself? We dont want to get sued and take the chance.
All of our debt is at one bank, two maxed our credit cards and one signature loan for $5,000. We have never been late on a payment for anything but we are about to loose unemployment and we will nto ahve near enough money to cover our bills without it. Please help us with anything tha tyou can, wether it be a refferal to a cheaper attorney or an online agent.


Thank you so much.

[62hotrod]

I don't know where your located but in south Alabama it's gonna cost me $1100.

[keepinitreal]

When you're sure you'll file Chapter 7, stop paying the 3 loans and give the money to your attorney instead. You should have him paid in full in 3 or 4 months.

[tcreegan]

NOLO book

Hello BKClueless,

There is a self-help book available from NOLO, online or at your local bookstore. This book is highly rated by senior gurus on this forum. If you are very detail oriented and willing to do the research, you can file "pro se" (for yourself) I filed chap 7 pro se, but read the bankruptcy laws (federal and local bankruptcy rules) beforehand. From what you have posted, yours seems like a very easy case. A good lawyer is always the better way to go, if you can. Shop around, stay local for face-to-face meetings, and check the Better Business Bureau. The best price I found (N. Colo.) was $500 + $299 filing fee for simple Chap. 7 cases.

Wish you well,

Tom

btw, find out what the means-test is and see if you pass. If you do not pass or can't figure it out, absolutely do not file yourself.

[Confused33]

If you only have $10,400 in debt I think you should seriously reconsider filing BK.

For comparison's sake my situation was REAL ugly in comparison to yours:

$150K house
$60K credit cards
$67K boat
$42K truck
$20K SUV

That is $339K in debt. I was 28 and the economy killed any hope of coming out of that alive.

$10K is something that you should be able to handle or stop paying, get your life together, and then settle your debts later at lower amounts with the collection agencies.

Don't waste $1500 on a lawyer over $10K.

[mrskal]

Don't waste $1500 on a lawyer over $10K.

That was my thought too. If you are about to go off unemployment, you have no income, what are they going to get from you anyway. I would definately hold off, and maybe workout some sort of arrangement with the creditors once you get a job.

Once you are late, maybe they will make a settlement or something. Do you have anything you can sell to pay towards it?

[tcreegan]

better to settle

If all you have is the three debts, then one can assume there is a paid-off house somewhere or you are renting. One can also assume there are paid-off vehicles somewhere. In a bankruptcy all your assets as well as all your debts are included.

With three debts owed to the same bank/finance company, a debt restructuring is the best way to go. Visit the bank and find out who has the authority to re-write loans. Make an appt to see them, lay all your financial cards out on the table with a payment scenario that you can live with. See what they will do.

Finding a honest and worthwhile debt settlement company is like finding a needle in a haystack. See if they are a member of TASC (The Association of Settlement Companies) and check w/ BBB

If you try the settlement route first and it doesn't pan out, you still can fall back on a bankruptcy.

Tom in Colo

[amalejko]

I agree; you should NOT file bankruptcy for 10k in debt. Your lawyer is giving you really bad advice. Go to the bank in person and sit down and talk to them; they may reduce interest or give you a reprieve on payments etc but don't tell them that you are considering bk. Just that you need a little help. You will ruin your credit etc for years and 10k is not worth it.

[BkClueless]

thank you

Unfortunately BK is the only way to go. We have never missed or been late on a payment to the BANK but within doing all of this we are $1000 late in rent and we cannot miss another payment. my partner and myself both have jobs but there is nothing we can do as far as the bank, it can only cut the payments a bit but we still cannot afford to pay for them.
I will deffinitaly take a look at that book, i think self filing would be best i am just unsure or the laws.

Thank you all for the advice so much, we wish there was another way.

[mrskal]

I thought you said you were about to lose unemployment, Did you get jobs? I personally still dont think you need to BK. Pay your rent. Get that situated. You said you have never been late on your payments. I dont see what the rush is to do BK. They are not going to throw you in jail. Pay them what you can until you can get ahead, maybe you can settle some of the debt and have a payment plan that is affordable once you do have late payment.
If you are making payments now, they do not see that you are having a hardship. I had to go about 3-4 months behind on my CC's and loans before they did it. Every single one of them did. One was a CC for about 8k, got on a payment plan for 5 years at 4.99%. I was paying 24%!
You can also threaten them that you are doing BK, it may get them to work with you.
I still think that BK for 10K in debt is not a good idea. Hope you can work it out.

[momofthree]

Just because you stop paying them doesn't mean that you need to file bk. You can only file bk once every 8 years. With no jobs, you probably also don't have any medical coverage, you probably have very basic car insurance (if you have it at all). All it would take would be 1 emergency situation or illness and you'd be in a much worse situation than you are in now and you'd already have used up your one bankruptcy.

$10k is practically nothing in debt. If you don't have jobs, probably don't own a home, there is nothing the bank can do to you if you don't pay them. Just live on cash (keep money out of the bank) and save the bk option for when you truly need it.

[ja181]

All of our debt is at one bank, two maxed our credit cards and one signature loan for $5,000. We have never been late on a payment for anything but we are about to loose unemployment and we will nto ahve near enough money to cover our bills without it. Please help us with anything tha tyou can, wether it be a refferal to a cheaper attorney or an online agent.

I really feel bad for you and your situation. This recession is rough, impacts so many people that have worked hard to honor their debt commitments.

[meateater]

Hi BKClueless
Not knowing the details of your situation (income, assets such as cars, house), it's not really possible to give advice about bankruptcy. But in addition to checking out the NOLO book (which you can probably get at the library), I would also look into the Dave Ramsey books. The books have a strategy for getting out of debt, and it's possible you are not so deeply in debt that you might be able to turn it around short of bankruptcy. And even if you do file BK, the Ramsey plan (or something similar) might be helpful in terms of avoiding future financial problems.

Ramsey is very anti-bankruptcy (even though he filed himself), so I would only look at his "get out of debt" advise and ignore the commentary about bankruptcy. I filed pro se under the old law, it was not all that difficult, I'm not sure how complicated the new law is, but I'd at least read the NOLO book and see if it looks like something you can do yourself.

Good luck!

meateater

[blockhead]

Unfortunately BK is the only way to go. We have never missed or been late on a payment to the BANK but within doing all of this we are $1000 late in rent and we cannot miss another payment. my partner and myself both have jobs but there is nothing we can do as far as the bank, it can only cut the payments a bit but we still cannot afford to pay for them.
I will deffinitaly take a look at that book, i think self filing would be best i am just unsure or the laws.

Thank you all for the advice so much, we wish there was another way.

As others have said. You do NOT want to file BK for 10K.

[Medport]

I'm fairly new to this too and don't want to thread jack, but my situation seems to be similar. My debt is "only" about 17.5k all in credit cards. But I only make around 30k, and have mortgage, car lease payment, high student loan payments and a home equity loan. I have been contemplating this for about 6 months and finally spoke to an attorney a couple months ago. He told me to stop paying the credit card bills to save up to pay him. That's what I did and also recently got a small bonus and raise at work. I'm thinking it was bad advice as now my credit has taken a major hit and balances have went up due to late fees and interest increases.

Now I'm figuring maybe I could squeak by by getting a hardship program or something, but problem is with best possible scenario it would still take at least 8 years to pay the credit cards off. Also I have no health insurance and if I filed I could probably afford to get a cheap plan. I could also start paying extra on my home equity if I filed as I've only been paying the interest the past 6 years and it will come due in about 4. I'm not sure what will happen at that time, but know I need to start paying it down as much as I can and can't afford to if I don't file. I know I should'nt have gotten the new car last year and could dump it and/or the house, but think its better to keep them as I need a car and the lease is for only 2 more years. I just turned 40 and don't want to start over at my age with a new mortgage in a few years either, but it would make things easier as the home equity is eating up all the equity of the house and it needs a lot or repairs and the taxes, insurance and water are very expensive for the size/age of the house IMO.

Anyway, I guess my main questions are: does it sound like I should file and if so include the house and/or car? Also the attorney I talked to is'nt listed on BBB. I met him at a realtor's office in the town I work in, but his main office is supposedly in IN. He wants $1299 to file and that sounds about right and I turned in my paperwork a couple weeks ago, but have yet to pay him. I do have the money to pay it off right now. They said I can send a payment in to the main office, but I'm a little leery as they don't send a receipt or anything. How do you know for sure he is legit? His ad is in the phone book and he has a web page and states he has been in business for 22 years. Is there another place to look to confirm this info? thanks for any advice.