Hello everyone.
Here is what is going on. We are a family of four (two parents, one 9 year old, one baby) and we have accumulated about $37000 in debt. Most of this is two large CCs, some medical. This debt is over six months old. We have a mortgage but no equity, no assets. Our budget shows us $1600 in the hole/month for living expenses. That is with me receiving unemployment, my wife works part-time. I will be starting work again at the end of this month, but the income will only be the same as my current unemployment until I start getting commissions (if I am any good at the job, which is as a bill collector!)
Seems like a cut and dry Chapter 7, no?
Here is the twist. My parents are willing to lend me the money from their retirement account, which I could pay back for as long as it takes, to settle the debts for about $.40 on the dollar. So we are looking at about $15000.
My view is this:
-File chapter 7
-Rebuild credit from there
-This would get me out of a $370/mo payment on a high-interest $15000 car loan
-Borrow money from parents to get a cheap car
-Borrow money from parents as needed until we can balance the budget to keep our home (we are current on mortgage)
My parents' view is this:
-Avoid bankruptcy at all costs due to the ramifications
So my main question is: Under which scenario are we better off? Is settling going to be significantly better on our credit rating than a Chapter 7?
Any advice or opinions is greatly appreciated, and time is of the essence.
Here is what is going on. We are a family of four (two parents, one 9 year old, one baby) and we have accumulated about $37000 in debt. Most of this is two large CCs, some medical. This debt is over six months old. We have a mortgage but no equity, no assets. Our budget shows us $1600 in the hole/month for living expenses. That is with me receiving unemployment, my wife works part-time. I will be starting work again at the end of this month, but the income will only be the same as my current unemployment until I start getting commissions (if I am any good at the job, which is as a bill collector!)
Seems like a cut and dry Chapter 7, no?
Here is the twist. My parents are willing to lend me the money from their retirement account, which I could pay back for as long as it takes, to settle the debts for about $.40 on the dollar. So we are looking at about $15000.
My view is this:
-File chapter 7
-Rebuild credit from there
-This would get me out of a $370/mo payment on a high-interest $15000 car loan
-Borrow money from parents to get a cheap car
-Borrow money from parents as needed until we can balance the budget to keep our home (we are current on mortgage)
My parents' view is this:
-Avoid bankruptcy at all costs due to the ramifications
So my main question is: Under which scenario are we better off? Is settling going to be significantly better on our credit rating than a Chapter 7?
Any advice or opinions is greatly appreciated, and time is of the essence.
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