$130,000 debt, $8500 owed in taxes this year, should I file?

[Humonese]

You drive an 05 Jeep Grand Cherokee but HAVE to step into a 2009 Cadillac CTS for your job? That doesn't sound right. A 2 or 3 year old luxury car would make more sense and still be "somewhat classy". Unless I'm way off base, what is your job?

[StartingOver08]

I would agree that if you are going to be in a Ch 13 you need to start with a decent vehicle. I would question the value to you of a vehicle payment much past the alloted amount of $489/mth. You will find that the Ch 13 budget is tight anyway, how are you going to bury the extra $261/mth in your budget? You probably can still get a good 'classy' vehicle in the $500-$550/mth range - easier to fund than $750/mth. Remember, you have to pay gas and repairs now without using credit!! JMO.

[HipHop]

I was looking at used models, but the deals on the 09's were really good...only $5,000 more than a used model with almost 20,000 miles on it. On top of that you can write off the sales tax on all new vehicles now.

I am in IT technical sales and am often driving to potential clients sites and also have them in my vehicle. The Jeep was good enough when it was new, but is looking pretty tattered now.

I know I could find something a little cheaper, but is there any huge issues with following through with my plan? Will it cause me any huge issues getting through the Chapter 13 process, or will it just make it "harder" for me. I will have the ability to make a few hundred dollars extra (at least ) each month, cash.

[OhioFiler]

I was looking at used models, but the deals on the 09's were really good...only $5,000 more than a used model with almost 20,000 miles on it. On top of that you can write off the sales tax on all new vehicles now.

I am in IT technical sales and am often driving to potential clients sites and also have them in my vehicle. The Jeep was good enough when it was new, but is looking pretty tattered now.

I know I could find something a little cheaper, but is there any huge issues with following through with my plan? Will it cause me any huge issues getting through the Chapter 13 process, or will it just make it "harder" for me. I will have the ability to make a few hundred dollars extra (at least ) each month, cash.

I'm in sales and drive a classy Honda Civic. Customers don't buy based on the vehicle you drive. They buy based on perceived value vs price of the product or service you offer. If you offer an IT solution to your client for $100,000 and he thinks it's worth $65,000 the car you took him to lunch in is not a factor. If you offer the service for $60,000 and he believes it is worth $65,000 he'll buy but still won't care what vehicle you drove him to lunch in.

[Humonese]

That car's not selling anything for you. You should get a used Honda Accord for half of what you're thinking about spending on that CTS and take the couple hundred extra cash you're getting monthly and stick it under your mattress for a rainy day. Read some of Dave Ramsey's stuff....quick.

[HHM]

Thanks for your post HipHop. You need to understand why some of us are apprehensive about your plans to add to the overwhelming 'toxic debt' problem America has when you appear to make more money and live luxurious lifestyle then we can imagine.

You need to ask yourself how is filing BK going to impact society and how is it going to change your future spending/earning habits?

$117,000 in convenience card debt is not peanuts, even for large banks.

Have you thought about a second job? I am a computer programmer who spent 10 years working 20 hours a week loading trucks in a warehouse while work 50 hours a week. Working two jobs when you are young is much easier then when you get older like me.

Thanks all for the responses. I still have a few more questions. I did meet with a lawyer and he said Chapter 13 is really the only way to go to take care of my situation.

Here are some current (more accurate) numbers for me:

Gross - $6994
Net - $4200 (after taxes, 401K loan ($5400 balance), healthcare/dental/vision)

Tax Debt - $8500
Unsecured Debt - $116,707 ($1200 is on a Best Buy card...I've heard that Best Buy cards are handled differently, is this true?)

Auto Loan - $650 ($15,500 owed, value around $9,000)
Rent - $750
Parking - $150
Cell - $50
Utilities - $400
Food/Clothing - $500
Misc (Dry Cleaning, Healthclub, etc) - $100
Gas - $200
IRS Taxes - $141 ($8500/60 months, is this correct?)

If you were a computer programmer, you think you could figure out how to use the BBCode to properly quote text in the forum.

As for getting a second job; in this economy that is probably unrealistic when we are approaching 9% of the workforce that can't even get a first job. An interesting note, at the beginning of baseball season, Dodger Stadium hires 500 people to work the season (ushers, greeters, vendors etc). Normally, they cannot fill all 500 positions. This year, 10,000 people showed up to Dodger Stadium to get one of those positions.

I really don't think someone needs to think about how BK will effect "society"; society has already accepted BK as a legitimate legal tool for dealing with debt.

[fltoo]

ferlsig=commonman=sweet potato=many,many other names

Poor thing must suffer from multiple personality disorder.

[OhioFiler]

ferlsig=commonman=sweet potato=many,many other names

Poor thing must suffer from multiple personality disorder.

Dude's on a mission. Not sure what he thinks he'll accomplish but he clearly is one angry little man who most likely suffers SPS*.













*Small Penis Syndrome

[lonesumluser]

I was in pretty much the same boat, $130,000 credit card debt. They allow you so much for food and other stuff, then all the rest of your money they set your payment at. I am struggling, mine came out to be $2343 monthly. That means I will pay back almost all of the debt, the more you make the more they take.

But I need this whole mess gone, I am going to do it, I have an extra job to help out, hopefully I'll make it through, I tried the debt negotiation route and they screwed me royally, still hoping they will fix what they messed up.

Chapter 13 is your best option but it is expensive, but if worst comes to worst and you can't make the payments they work with you and you can change to Chapter 7!!

[pcn]

If your numbers are correct, Chapter 7 is out of the question. You earn way too much money. Chapter 13 is going to be pretty rough on you as well if your expenses are that low.
There are things you can do to increase your living expenses, but doing them with the obvious intention of decreasing your disposable income won't earn you any points with the trustee or the Court.

One of the safest and legal ways of decreasing your disposable income would be to take a maximum amount out of your 401K as a loan and using the money to pay down some of your unsecured cc debt. Your 401k is protected. Then, you will at least be paying yourself back some of the money during the Chapter 13. 401 K loan payments are legitimate expenses in a Chapter 13 that decrease disposable income. I know because I am in Chapter 13 and I have 401 K loans.

One thing is virtually certain - you will never get out from under the unsecured debt without bankruptcy protection. Good luck......

God GOD!!!!! You can't be serious. One of the most basic things any counselor will tell you is done sacrifice your future trying to pay off unsecured debt. Make use of the many free initial visits that bk lawyers offer. Talk to a credit counselor (not a debt relief agency) they may review your situation and recommend bk. If you are in a financial meltdown, the worst thing you can do is sell off your future trying to fix something that may not be "fixable".

[pcn]

Thanks for your post HHM. I respectively disagree completely.

1. I bet I can get a second job in two weeks in the rust belt(ohio). Subway had a 'help wanted' sign up yesterday.

Freedom is not free.

Please detail your plan. The thought of getting out of debt by taking on a part-time job at little more than minimum wage sounds very appealing to me. My rough calculation puts my plan at 16+ years if the kind cc companies are willing to stop charging me interest. What's your secret?

[HHM]

Thanks for your post HHM. I respectively disagree completely.

1. I bet I can get a second job in two weeks in the rust belt(ohio). Subway had a 'help wanted' sign up yesterday.

2. Society has NOT accepted BK. None of my family/friends/co-workers have accepted BK. You must hang out with a different crowd of people, listen to a different radio station, or only post on only one forum.

BK is wonderful for the truly deserving and should not be abused because of greed and materialism.

Do you think 'toxic debt' is the main cause of our current worldwide recession? Lots on news commentators I listen to think so.

Freedom is not free.

Hmm, I wasn't aware "society" was limited to your family/friends/co-workers, that is awfully narrow, don't you think? Let's see, bankruptcy is actually authorized in the US constitution, so in that respect, bankruptcy is part of our American society, it was there from the beginning, just like the freedom of speech, right to bear arms, etc.

In any event, your a forum troll that is not much help, so after we are done having fun, we will probably ban you, like we have with all your previous user names.

[spearmint]

I get so tired of people judging other people - for anything. Unless you walk in another person's shoes and fully understand what has happened, no one has any right to judge.

At my age, I only am concerned about what my little family thinks and to h*** with outsiders. (And my little family consists of my pets lol).

I am doing the best for me and that is what matters.

[pcn]

Life as a forum troll seems so sad. Is this what people with no family, friends, or purpose in life really do now-days? What happened to scaring kids on the street, reading tabloids, or watching soap operas? The internet has really opened people's options...

[CompTweaker]

Hmmmm, so ferlsig, you want to place a scarlet letter on everyone who files BK? You know, its people like you who feed the common misperceptions of filing bk and promote one to think "Im a failure and a burden on society".

Since you are a news watcher, then maybe you have paid attention to the many tragic stories of suicides or other measures, (like killing their whole family) some people take because they think there is no other way out. I could go on and on, but I no longer want to waste my time on someone like you.....well, other than to say "SHAME ON YOU!"