We are sitting here waiting to file chapter 7. We qualify because we are under the median income. We own our house but the payments are too high for us to live here comfortably and we have used CC's as a crutch for 10 years, periodically refinancing our debt with home equity. We live with no luxury items whatsoever and our house isn't even that big. But we have 3 kids and we really want a simple life living on my husband's income.
Now the house payment is high and the CC's are high again and we have no home equity left to refinance (thankfully). We are considering chapter 7 to surrender the house and the 20k in CC that we have now. And then move into a much smaller place and rent for $700 per month less than what our mortgage is here.
I am also considering Debt Settlement that will cost us $11k and Short Sale. I know that these debts might come back to haunt us with 1099. But if we can afford to do debt settlement is it a better option? Can I better use the $11k that I would have paid to debt settlement to pay down our student loans?
We have not waited until the last minute, if anything I feel like we might be jumping the gun. We just missed our first mortgage payment and we have decided not to pay our cc's anymore. We sold our newer car and bought another older one for $3500.00. This left us with some cash because the car had also been paid off with a home equity loan.
My husband has taken a substantial pay cut and we don't know how long it will last. We have cash on hand for our living expenses for now and it's too much to file Bk without spending it. Our only expenses will be living expenses and moving expenses but we are saving up for those and hoping to file BK before we have to move. But we aren't supposed to have the money so do we have to move first and then file?
Does it actually make more sense to wait a year or another six months before we file? Until we are really at our wits end and the house is almost to auction? What if I could transfer all of the money that I am paying to CC's and mortgage now toward my student loan debts that won't be erased by the BK. Will the trustee overturn those payments?
Is it fraud to pay down student loans with money that you would have paid to your mortgage?
Now the house payment is high and the CC's are high again and we have no home equity left to refinance (thankfully). We are considering chapter 7 to surrender the house and the 20k in CC that we have now. And then move into a much smaller place and rent for $700 per month less than what our mortgage is here.
I am also considering Debt Settlement that will cost us $11k and Short Sale. I know that these debts might come back to haunt us with 1099. But if we can afford to do debt settlement is it a better option? Can I better use the $11k that I would have paid to debt settlement to pay down our student loans?
We have not waited until the last minute, if anything I feel like we might be jumping the gun. We just missed our first mortgage payment and we have decided not to pay our cc's anymore. We sold our newer car and bought another older one for $3500.00. This left us with some cash because the car had also been paid off with a home equity loan.
My husband has taken a substantial pay cut and we don't know how long it will last. We have cash on hand for our living expenses for now and it's too much to file Bk without spending it. Our only expenses will be living expenses and moving expenses but we are saving up for those and hoping to file BK before we have to move. But we aren't supposed to have the money so do we have to move first and then file?
Does it actually make more sense to wait a year or another six months before we file? Until we are really at our wits end and the house is almost to auction? What if I could transfer all of the money that I am paying to CC's and mortgage now toward my student loan debts that won't be erased by the BK. Will the trustee overturn those payments?
Is it fraud to pay down student loans with money that you would have paid to your mortgage?
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