Which Direction to go

[deepinit]

What to do?
We live in SE Ohio - we have $87k in CC debt and havent used them since November - thank God -
We have 2 homes - one rental worth about $105k (owe $91k on ) that we get $925 a month for - our home we live in we owe about $210k on first and $47 on 2nd.
We make about $95k per year.
I can afford our current home and bills but not the $1500 per month credit cards.
Should I look into a Chap 7 and get rid of the cards and the rental unit? Or should I look into a Chap 13 and do a lien strip on my 2nd of 47k and use that $550 per month to repay some the credit cards in a Chap 13 repayment plan. My thinking is I can do a 13 and save myself some money by getting rid of the $47k 2nd mort. I can pay $550 per month to creditors a total of $33k after 5 years ( assuming thats what my plan would be) and be done with it and keep my rental home.
Instead of getting rid of the 2nd home the cc debt of $87k with a chap 7
I think I would save myself money with the 13 because I can't lien strip the 2nd mort. with a Chap 7 and will still owe that 47k?
I took the means test and believe that I will qualify for a 7 if I want it.
What is the best route to go?
sorry for the long post - I appreciate all of your comments.

[HHM]

What is the value of your primary residence.
Does the rental home at least pay for itself. (granted, to be in the business of renting, your rent payment should exceed the monthly expenses by 30%, so you can save for repairs, upkeep, and vacancy). But for now, does the rent at least cover the recurring expenses?

You are right to ask for options, your CC debt is way to high for your income. You might be a little optimistic about passing the means test, but it is possible.

If the house is truly upside down, and you qualify for 7, I would go with that option. Once the chapter 7 is discharged, then you can approach the 2nd mortgage lender with a settlement offer to remove the lien. (but that scenario is a little more risky than just doing a chapter 13).

[keepinitreal]

You are right to ask for options, your CC debt is way to high for your income. You might be a little optimistic about passing the means test, but it is possible.

If their cc debt of $87k is way too high for their income of $95k, then I'm in trouble. My unsecured debt is slightly MORE than our annual household income.

[HHM]

If their cc debt of $87k is way too high for their income of $95k, then I'm in trouble. My unsecured debt is slightly MORE than our annual household income.

On average if a person making less than $140,000 per year, if their debt to income ratio is more than 40%, then the debt is getting in the way of achieving other financial goals, and the person needs to start considering bankruptcy as a way to get out of debt.

The OP's D/I is 91.5%. It is simply unrealistic to be able to pay that debt off in 5 years or less. Thus, if your unsecured debt load is 100%+, you are bankrupt, you just need to admit it at this point.

[deepinit]

My primary residence has a value of about $210k on its best day right now. Our rental just covers the expenses right now.
We are landlords by accident - bought our 2nd home before the first sold and then everything tanked. We were hoping to hang onto it as an investment - but I don't know if thats the right decision at this point - part of our CC debt (about $10K) has come from the past 2 bad tenants and me not screening well enough. They damaged the home and didn't pay. We do have good tenants now though.
I am ready to move on either way though and am looking into speaking with an attorney to decide the best options. I am on some repayment plans with a few cards that we got behind on but I am sick of getting calls from a few of the creditors.
I just want to end it all in the best possible way.
I misspoke - I do fail the means test by far!! with all debts considered with a family of 7.
Should I not pay on the 2nd mort.? Won't they just try to foreclose or lien the property?

[keepinitreal]

On average if a person making less than $140,000 per year, if their debt to income ratio is more than 40%, then the debt is getting in the way of achieving other financial goals, and the person needs to start considering bankruptcy as a way to get out of debt.

The OP's D/I is 91.5%. It is simply unrealistic to be able to pay that debt off in 5 years or less. Thus, if your unsecured debt load is 100%+, you are bankrupt, you just need to admit it at this point.

Thanks HHM. Before I was laid off, our debt to income ratio was close to 50%, but now it's over 100%. I do admit I'm bankrupt, and have met my first bankruptcy attorney this past week.

[badkarma]

don't know if this helps we are in NE Ohio we just did Ch7.... we also have a rental, rent bearly covers expense rental worth 55,000 we owe 58,900 TT just sent abandonment letter for it. our primary home worth 142,000 we owe 130,000 waiting to hear what TT has to say for that... we have personal loan and cr card debts of 40,000 hoping to discharge and wanting to do ride-theough on all mortgages and car loan. TT also wasn't interested in our tax refund even though it's a lot maybe because hubby is laid off and we have 4 kids she felt bad for us,lol
YOu will learn so much off this forum from these great people here
TX