Request for Advice/Review

[DustinLH00]

Hello All!

New member here and have been reading for hours and would like to present my situation for review. I just would like some unbiased 3rd party eyes/opinions.

I am 26 years old and have a home and car. I work for a bank. I also have a 2nd part time job at a video store.

Currently, I have accumulated a total of $35,000 in unsecured credit card debt. I have extended myself beyond my means and am at a point where I have to charge at least 2 bills a month on my CC just to get by. As you can imagine, the balance is rapidly approaching the limit on several cards.

I am struggling with the moral issues here and would love to pay this off, but I just don't see a light at the end of the tunnel anymore. I want to keep my home and car, so I would reaffirm the 2 mortgages and the car.

Should I file? Should I worry about my job, working for a bank? They would find out as the 2nd mortgage is with them. I have a credit score in the 700 area and have 0 late payments on my credit report. I think that is one of the hardest things, is the fact that I have no blemishes and good credit for my age (with exception to the amount of debt). Please let me know your thoughts, I appreciate your time.

[AngelinaCatHub]

You are compounding your debt when paying bills with CC. As a banker, I don't have to tell you that. Your only hope is to work out with the CC companies. If they refuse to do this, you may attempt to go C13, but that is not a "new start". It will force the cards to take a smaller no interest payment from 36 to 60 months. You will of course have to tell your boss. I would not reaffirm the car, just pay through as you do not know if your bank will even exist as we keep printing worthless money and flooding the economy with it. In a year or two at most, you are going to see such inflation and interest rates that even Prs Carter would never have dreamed of. 'Hub

P.S. If you go 13, but you pay some bills with card, will you be able to make those bills without the cards? If not, go 7 and you are young enough to fix your credit.

[jribe]

i work for one of the top national banks here in the US. You can PM me if you want, obviously can't give too many details on a forum like this..
Are you part time at the bank or full time? It depends on what type of position you hold.

You will *not* want to default on the mortgage with the bank you work at.. And definitly get new accounts at another bank and change your DD if you are thinking of missing payments. It's a big corporation, they don't usually care if you work for them or not.

Can you give us more info on the home value and what you owe? Unless you bought in the last year- it's usually best to drop the house. Many are so underwater, and you can buy the same house across the street for at least 25-50% less in most areas... just a thought

Also, what are the details on the car? How much do you owe, and how many miles? That will again let us know if it's worth it to keep the car. In many situations it is not. Especially right now when there's great deals on cars.

I don't believe you put your state, or your income also. You'll need to do a means test; check out "legal consumer" means test- it's decent. That will give you a rough idea if you'll qualify for a 7, or what a payment could be in a 13.

Good luck

Hello All!

New member here and have been reading for hours and would like to present my situation for review. I just would like some unbiased 3rd party eyes/opinions.

I am 26 years old and have a home and car. I work for a bank. I also have a 2nd part time job at a video store.

Currently, I have accumulated a total of $35,000 in unsecured credit card debt. I have extended myself beyond my means and am at a point where I have to charge at least 2 bills a month on my CC just to get by. As you can imagine, the balance is rapidly approaching the limit on several cards.

I am struggling with the moral issues here and would love to pay this off, but I just don't see a light at the end of the tunnel anymore. I want to keep my home and car, so I would reaffirm the 2 mortgages and the car.

Should I file? Should I worry about my job, working for a bank? They would find out as the 2nd mortgage is with them. I have a credit score in the 700 area and have 0 late payments on my credit report. I think that is one of the hardest things, is the fact that I have no blemishes and good credit for my age (with exception to the amount of debt). Please let me know your thoughts, I appreciate your time.

[zpbk13]

I do not work for a bank so cannot comment on that aspect. However, I would like to comment on the morality of bk from my own humble experience. My husband and I always paid our bills on time (or early because I am just like that). I would have never EVER dreamed in a million billion years that we would even consider bk as a viable option for us. But here we are. This forum has helped me to see that bankruptcy is not the end of the world. I have been helped to understand that the unfortunate stigma attached to bankruptcy is not my problem it is the "other" persons problem.

It has been said over and over again on this forum that bk is a business decision and it must be approached that way. You have to do what is best for you in the long run. No one wants bad credit. Me and husband both had scores at one time in the high 700s. I actually prided myself on my high rating. But I have come to the conclusion that I would rather have cash in the bank and no debt than a great credit rating based on how well I am making minimum monthly payments on high interest credit cards.

Ultimately, whether you file is up to you. But please know that the stereotypical bk filer presented in the media is not true - at least not here on this forum - people that file bk are not dead beats who have spent credit like drunken sailors and now that the party is over they just refuse to pay their debts. BK is here for the protection of the consumer that may have gotten over their heads for one reason or another. And as you have probably read dozens of times on this forum, if you decide to file - you are not alone.

I wish you good physical and financial health!

[DustinLH00]

I appreciate the response and apologize for not posting more info. The bank is a local regional bank, 33 branches. I work there full time and will have been there 7 years next week. I was in retail the entire time until this past January when I accepted a software position in the operations department.

I would not dream on being late or defaulting on either the 1st or 2nd mortgage. Especially the one at my bank, and have no plans to be late whatsoever, even if I do file.

I really do not want to lose the house. I have just hit the 4 year mark of owning the home. I did a 100% financing option, so the homes fair cash value on the tax bill is $112,000 and my 1st mortgage balance is $95,000 and 2nd mortgage balance is $6,000 so I pretty much have no equity.

I just purchased a 2009 Accord on 1/2/09, so its only 5 months old with around 7,500 miles. I bought it brand new and it is of course still under warranty...

My income is $42,000 at the bank and around $5,000 or so at the 2nd job. Currently, my net pay minus just my mortgage, 2nd mtg, car, insurance, all utilities and credit card minimum payments...I am at a -$150 deficit every month. That is not including food, prescriptions, fuel, etc...

Thank you so much for taking the time to look at my situation.

i work for one of the top national banks here in the US. You can PM me if you want, obviously can't give too many details on a forum like this..
Are you part time at the bank or full time? It depends on what type of position you hold.

You will *not* want to default on the mortgage with the bank you work at.. And definitly get new accounts at another bank and change your DD if you are thinking of missing payments. It's a big corporation, they don't usually care if you work for them or not.

Can you give us more info on the home value and what you owe? Unless you bought in the last year- it's usually best to drop the house. Many are so underwater, and you can buy the same house across the street for at least 25-50% less in most areas... just a thought

Also, what are the details on the car? How much do you owe, and how many miles? That will again let us know if it's worth it to keep the car. In many situations it is not. Especially right now when there's great deals on cars.

I don't believe you put your state, or your income also. You'll need to do a means test; check out "legal consumer" means test- it's decent. That will give you a rough idea if you'll qualify for a 7, or what a payment could be in a 13.

Good luck

[DustinLH00]

I am definitely aware of that. My hope originally was to make it until tax refund time, use that money to pay down the CC a little bit, which will only be around $2,000. Then get through next year until December. Come then, my 2nd mtg will be paid off and it will be tax time again. I could use the money from the refund to again pay down the CC a little bit and with the extra $335 a month from not paying the 2nd mtg, I would hopefully be able to cut up the cards.

From this perspective though, I am looking at a year and a half before I can even logically attempt to stop using the cards and start paying them off, so that is why I feel somewhat hopeless. That and the fact I have been working 2 jobs for 4 years now and it is starting to get old and I would for sure not be able to drop the 2nd job for at least a few years after the 1 1/2 year point from now...

I am currently paying nearly $800 a month in CC min payments. My -$150 deficit will turn into a $600 surplus after paying mortgage, 2nd mortgage, utilities. I think that $600 should cover my fuel, food, recreation, etc... for just me as I am single. So I should be able to live on cash.

Once the 2nd mortgage is paid off in a year and a half, then hopefully I could quit the 2nd job and get my social life back... Does this help? Thanks!!

I appreciate your time.

You are compounding your debt when paying bills with CC. As a banker, I don't have to tell you that. Your only hope is to work out with the CC companies. If they refuse to do this, you may attempt to go C13, but that is not a "new start". It will force the cards to take a smaller no interest payment from 36 to 60 months. You will of course have to tell your boss. I would not reaffirm the car, just pay through as you do not know if your bank will even exist as we keep printing worthless money and flooding the economy with it. In a year or two at most, you are going to see such inflation and interest rates that even Prs Carter would never have dreamed of. 'Hub

P.S. If you go 13, but you pay some bills with card, will you be able to make those bills without the cards? If not, go 7 and you are young enough to fix your credit.

[kenshirley]

I know that a relative who worked for a very large financial organization years ago found himself in BK due to a divorce.
He told me that BK was not done or he would lose his job.
The bank made him a loan at very low rates to get him out of the mess.
He was a very high ranking type with the company and I guess they think they are special.

[DustinLH00]

My experience working at the bank has been that we are under more scrutiny for loans to employees than customers. If an examiner sees that they give me a $35,000 unsecured loan with less than $350,000 in net worth, they better see that they did the same for a non-employee or they are in big trouble. So, I honestly do not see them doing that for me. I do appreciate your response. Thanks!

I know that a relative who worked for a very large financial organization years ago found himself in BK due to a divorce.
He told me that BK was not done or he would lose his job.
The bank made him a loan at very low rates to get him out of the mess.
He was a very high ranking type with the company and I guess they think they are special.

[DustinLH00]

Your only hope is to work out with the CC companies.

Has anyone had any sucess stories accomplishing this? I was wondering what would happen if I called all 6 CC companies and told them that I was preparing to file bankruptcy, but would refrain if I could negotiate a settlement and payment plan with each creditor. I know it's not going to happen, but if I could cut the debt down in half and pay that over a period of time, say 4 or 5 years, I could survive with that.

But, my understanding has been that when they settle they expect payment in full immediately...

Just another thought I guess. I appreciate everyone's suggestions and time. Please continue to discuss. Thank you!

[DustinLH00]

Update

I decided to meet with an attorney last night to ask some questions and such. I was informed that I make too much money to file for a chapter 7. I am still in complete shock. I don't know what the hell they are thinking, but this is completely rediculous. Plus, they look at your gross income. That is complete b.s. because over $800 a month is taken out of my paycheck a month before I even see it. According to her calculating my income on the past 6 months, I make just over $4000 a month. This is disgusting considering, I take home $2900 a month, if I am lucky, between both jobs.

So now I do not know what to do. BK is supposed to be the "last resort", ya know, the one thing you can do when all else fails. She did not tell me much about the Chapter 13, just saying that I would have to come up with around $4000 in fees and that she has no clue what my payment amount would end up being.

Any suggestions?

[hamburgervol]

Did you take the means test? Many people are over the median income and can still file Chapter 7 due to there other secured debts being higher. I would get a few more consults if I were you and also take the means test online just to see where you stand.

Another option would be to call all of the CC companies and ask to speak to their hardship departments. You nust speak to the hardship department. Tell them you are trying to avoid bankruptcy and need help. In our case we called Chase and AMEX, the only 2 CC we had, and they both lowered our interest rates. Chase 6% for 12 months, AMEX 0% for 6 months then was to increase to 6% for the next 6 months. I was told to call back after I was in those programs after a year to re-enroll. In our case, those programs helped payment wise but it would have taken 25 years to payoff the debt.

[deadbroke99]

I decided to meet with an attorney last night to ask some questions and such. I was informed that I make too much money to file for a chapter 7. I am still in complete shock. I don't know what the hell they are thinking, but this is completely rediculous. Plus, they look at your gross income. That is complete b.s. because over $800 a month is taken out of my paycheck a month before I even see it. According to her calculating my income on the past 6 months, I make just over $4000 a month. This is disgusting considering, I take home $2900 a month, if I am lucky, between both jobs.

So now I do not know what to do. BK is supposed to be the "last resort", ya know, the one thing you can do when all else fails. She did not tell me much about the Chapter 13, just saying that I would have to come up with around $4000 in fees and that she has no clue what my payment amount would end up being.

Any suggestions?

Talk to several attorneys. Your gross income is used but your taxes are subtracted from that. We are over median by $20,000 but were able to file CH 7 due to our mortgage payments and cars we are keeping and other expenses. We just filed Thursday so I am no expert!

[lmeghanx]

I feel like we are in similar situations. I am also 26 and work for a large bank in the securities division and have not filed due to the stigma of bankruptcy and fear of never being able to work in the finance field again. I have no assets and a low income so I qualify for chapter 7 but I'm currently trying to negotiate a settlement with the credit card companies. I owe about 45k in cc debt and approaching chargeoff in a few weeks.

[DustinLH00]

Means Test

I completed the BK means test at legalconsumer.com and the results seem positive:

Monthly Income: $4,100

Automatic Deductions: $2,547
Other Deductions (Health & Dental Ins): $104
Deduction for Secured Debt: $1,613
Total Deductions: $4,264

Monthly Disposable Income: -$164 (or -$9,821 over 5 years)

So this seems like I am eligible to file a Chapter 7 at this point. Do these numbers look about right to you folks? I know they vary by person, but I just want to make sure nothing looks odd or wrong...

Talk to several attorneys. Your gross income is used but your taxes are subtracted from that. We are over median by $20,000 but were able to file CH 7 due to our mortgage payments and cars we are keeping and other expenses. We just filed Thursday so I am no expert!

[DustinLH00]

Wow, we are twins! Have you stopped paying your CC minimum payments then? Have you spoken to anyone at your employer about possibly filing for BK?

I feel like we are in similar situations. I am also 26 and work for a large bank in the securities division and have not filed due to the stigma of bankruptcy and fear of never being able to work in the finance field again. I have no assets and a low income so I qualify for chapter 7 but I'm currently trying to negotiate a settlement with the credit card companies. I owe about 45k in cc debt and approaching chargeoff in a few weeks.