New and looking for advice. File Bankruptcy or Negotiate with Collection Companies?

[LinzH]

Hello!
This is my first time posting but this seems to be the right place for me to come. I am at a crossroads (I guess that is what I would call it). I am having a hard time deciding if I want to file bankruptcy or if I should work with my creditors/collection agencies.

A little backround about myself: I am 28, single, and recently moved back home with parents (living rent free but helping when I can). I was living out of state when I first got behind on my credit cards (around Aug/Sept 09). I looked into filing bankruptcy, had my first meeting, paid the lawyer $100 out of $1500. I was in the process of saving the money to pay the lawyer when I moved back in with my parents.
I met with a lawyer in the state I currently live in(MA). I found out that I cannot file until 6 months after I live in MA, which would be in June.

My employment situation is bad. I am currently employed part time taking home roughly $100/week. I am still very actively looking for full time employment and currently in school working towards a degree.

I guess my ultimate question is...based on my situation is it worth it to me to try to settle my debt instead of having a bankruptcy on my credit report once I find a full time job?

A few numbers:
Estimate of Debt: $30,000 (all credit cards, my car is paid off)
I stopped paying my credit cards around Aug/Sept of 2009.
Most are still in the collection agency stage. I have not rec'd any letters threatening courts or lawsuits yet.
In addition to credit cards I have about $200 per month in other bills (car ins, cell phone, 2 student loans).

If it is worth trying to settle, should I do this on my own or look for help from a professional?

Thank you in advance for any advice/input!

[nc73]

well with your level of debt and income you can file. I would wait it out though until you found a better job and pay your debt. With the money you make currently it wouldn't be worth it for the creditors to come after you.

[BCA2009]

well with your level of debt and income you can file. I would wait it out though until you found a better job and pay your debt. With the money you make currently it wouldn't be worth it for the creditors to come after you.

The only problem with this is that interest and fees keep building. It still might be the best plan, but with 29% or higher interest rates, the 30K in debt almost double in a year or so.

But you probably would be able to settle at significantly lower than what you owe, but your credit is going in the dump regardless of what you do.

But as NC 73 said there is really nothing the creditors can get from you now, so just hold off and see what happens in future. Unless you get a really good paying job you will still have the option of filing Chap 7 in the future. And if you do get a really good paying job, you can try to settle the debt then.

Good Luck!

[catleg]

Definitely file the BK. As was pointed out, that debt is going to explode at penalty rates (30%) plus late and overlimit fees. No matter. If you're ambitious you might turn this into a learning experience and learn how to file for yourself. In a case like yours a lawyer probably isn't necessary.