Bankruptcy? Settlement? Go to Court??? Do not know what to do!

[MarieT]

10% settlement across the board, with multiple creditors, is wildly unrealistic. You need to be prepared for "averages" closer to 30-40% when you are all said and done. Sure, there are exceptions, but statistically, you need to budget for hold outs, being sued (settlement % goes way up once sued), etc.

I agree that it might be a long shot and we definitely could not do the 30% to 40%. If we had more then four creditors to deal with, I do not think it would be a good option.

I just think we owe it to ourselves to take a hard look at every available option since once we do the BK we can't turn around later and say I wish we had tried to work out a settlement.

[HHM]

I think you are harboring false assumptions that DS is somehow better than BK. It isn't. In fact, because it usually costs more to settle than BK, it is a WORSE option than BK. There is no feature of DS, (credit reporting, future job, etc) that is better than BK. Save you money, and BK. Since you say you are probably a chap 13, the issue simply comes down to which one cost less, would the total of your monthly payments in 13 be more or less than what is required to settle.

And again, just a shot of realism, even with 4 creditors, 10% across the board is not realistic. You will likely need more. The problem, when someone is dead set on DS (or avoiding BK) and doesn't have a realistic budget for settlement, they tend to settle 1 or 2 debts, the others won't settle in your budget, so you end up in BK, having already lost that money you paid to settle other debts. Now, if you have an attorney helping, that is good, but getting everyone down to 10% is actually quite rare.

[MarieT]

Thanks HHM...I have read many of your posts and you always seem to be very logical and I appreciate that.

We would not settle with one creditor unless all four agreed to it and it would also have to not cost us more than the payments for CH 13 over the next 5 years.

We will be meeting with our attorney in the very near future to figure out what a CH 13 will cost and that will be helpful.