Yet another question from this newbie

[Photomom]

Not exactly sure which way to go. I would really like to avoid bk, another option I think we may have is sell our house, I know it may take a little while. I just missed my first cc payments this month, I should be able to keep everything else up to date. I figure by the time my house sells we may be able to offer the cc companies a "settlement in full" type offer and avoid bk. We do have a rental we can move into. Anyone have any opinions, done this(the settlement)?

[tobee43]

we first attempted to sell our house. actually, that was our very first step. it's certainly worth a try.

if you can't sell it you may want to consider to sell with an option to buy via a land contract...that could also maybe work for you.

[kornellred]

Now that you have missed cc payments, you have set certain realities in motion; late fees and APR percentage increases for sure. This will be reported to the credit reporting agencies and your FICO score will drop precipitously. There is no turning back, and any possible remedy will be expensive. Good luck!

[HHM]

Why waste the money on settlement...as Kornellred pointed out, you have already put certain realities in motion...the reality is, once you stop paying credit cards, BK practically becomes inevitable because once you come to your senses and realize the cure (BK) is not worst than the disease (Debt), and you realize how much it will actually cost to settle and that there is NO BENEFIT to you to settling vs BK, you will opt for BK (assuming you qualify).

Start meeting with BK attorneys NOW, to get a better sense of your situation and real options.

[sunshinepa]

Have you looked at the housing market in your area? I just talked to a realtor friend, prices are dropping, dropping and dropping. PA had not been hit as hard as some other states but it is now happening. I am in Hbg area and I can tell you in my township, prices have dropped about 10% in the last month, seriously. Do you have equity, can you make enough to really offer settlements? Can you last until you get sued by cc's? I got sued after six months of no payments!!

You should consider all this. As others said, your credit will tank as soon as you miss the 1st pymt. If you don't catch it up, it will get worse. Also, can you afford to loose the rental income or is it not rented?

Just some thoughts. Good luck in whatever you decide.

[Photomom]

Thanks for the replies everyone. I met with an attorney two weeks ago, went out of town because I was embarrassed, but I'm not sure. I am meeting with one in town tomorrow, hoping no one sees me go into his office! I know you guys probably think that's silly but I'm still not there yet, I work in the financial industry hence my embarrassment. I was wondering how long until the cc companies started suing. I just thought settling with them, for maybe half of what I owe, would be better than having bk on your credit. Am I wrong? I know I am not the only person who feels this way, I have been lurking for awhile, but my husband and I can't believe it's come to this. He hasn't worked since Oct. and he was told today it may even be late fall now. I cleaned out my 401 trying to stay afloat but this month was it, first payments I've never not paid because I couldn't.

Don't the cc companies ask you to settle for like pennies on the dollar or something?

As far as the housing market, I'm not sure. Some houses are going pretty fast and others aren't. he attorney I met with a couple of weeks ago told me not to sell my house yet. I just have a for sale by owner sign in my yard right now.

[InOverHead]

I am also extremely embarrassed about letting the financials get out of control, so you're not alone with that feeling. I have come to accept it's business decision, the stigma is not what it used to be as more and more people are in a mess due to the way the economy has been the past few years.

Settling is an option but A) you are at their mercy. Some may settle others might not. In BK they are forced to go along with the plan. B) The amount they forgive could be considered income if they 1099 you. There are apparantly ways around that via an IRS form proving/stating insolvency.

[IamOld]

I know it's easier said than done, but you are NOT NOT NOT alone. I think if you can get rid of everything without BK it may be "easier" since you stay out of the system.

BUT - as you're doing now - meet with BK atty's see what they say.

One thing with a CH7 bk is once it's done - it's DONE.

Thanks for the replies everyone. I met with an attorney two weeks ago, went out of town because I was embarrassed, but I'm not sure. I am meeting with one in town tomorrow, hoping no one sees me go into his office! I know you guys probably think that's silly but I'm still not there yet, I work in the financial industry hence my embarrassment. I was wondering how long until the cc companies started suing. I just thought settling with them, for maybe half of what I owe, would be better than having bk on your credit. Am I wrong? I know I am not the only person who feels this way, I have been lurking for awhile, but my husband and I can't believe it's come to this. He hasn't worked since Oct. and he was told today it may even be late fall now. I cleaned out my 401 trying to stay afloat but this month was it, first payments I've never not paid because I couldn't.

Don't the cc companies ask you to settle for like pennies on the dollar or something?

As far as the housing market, I'm not sure. Some houses are going pretty fast and others aren't. he attorney I met with a couple of weeks ago told me not to sell my house yet. I just have a for sale by owner sign in my yard right now.

[sunshinepa]

Thanks for the replies everyone. I met with an attorney two weeks ago, went out of town because I was embarrassed, but I'm not sure. I am meeting with one in town tomorrow, hoping no one sees me go into his office! I know you guys probably think that's silly but I'm still not there yet, I work in the financial industry hence my embarrassment. I was wondering how long until the cc companies started suing. I just thought settling with them, for maybe half of what I owe, would be better than having bk on your credit. Am I wrong? I know I am not the only person who feels this way, I have been lurking for awhile, but my husband and I can't believe it's come to this. He hasn't worked since Oct. and he was told today it may even be late fall now. I cleaned out my 401 trying to stay afloat but this month was it, first payments I've never not paid because I couldn't.

Don't the cc companies ask you to settle for like pennies on the dollar or something?

As far as the housing market, I'm not sure. Some houses are going pretty fast and others aren't. he attorney I met with a couple of weeks ago told me not to sell my house yet. I just have a for sale by owner sign in my yard right now.

Some offered to settle, the lowest it ever got for me was 45% of what I owed. That still would have left me with over 25,000 in debt, taking about 25 years to pay off, even with a little extra sent. No thank you. In addition, I would have 1099's at the end of it all.......no way.

Each person is different, you must do what is right for you. I know I am very happy with my decision, it was the right one for me. In 30 days (hopefully) this will all be over for me. I have already saved some money, feel much better and am planning on having company the whole month of August. I will be able to feed that company without using hot dogs and be able to go places. I did none of that while paying the cards after the new law allowed them to increase my payment.

Hope it all works out the way you want.

[lillymarlene]

Most of my creditors ended up offering me settlements. Some of the higher ones, for example $35,000 to be settled immediately for $16,000. Of course, by the time some of the offers were made, I didn't have it anyway and I'd have to live to 200 maybe to pay everybody off. Then, like a lot of people here, I didn't want to deal with the extra tax debt from 1099's.

[tobee43]

Most of my creditors ended up offering me settlements. Some of the higher ones, for example $35,000 to be settled immediately for $16,000. Of course, by the time some of the offers were made, I didn't have it anyway and I'd have to live to 200 maybe to pay everybody off. Then, like a lot of people here, I didn't want to deal with the extra tax debt from 1099's.

really lilly??? we didn't get a one...but a ONE??? i do wonder why?

[lillymarlene]

really lilly??? we didn't get a one...but a ONE??? i do wonder why?

Really! One what 1099? I never got one, but it seems like some people have. Then though they never did, a couple of my creditors claimed they were going to send me 1099's. Some people probably do get them.

[AngelinaCat]

We only had two CCs but both were basically owned by the same company. One had at least 6K of debt and the other around 36K. We wrote them both and asked if we could work something out and at least pay a little, provided they stopped adding the interest and late fees. NOPE, NADA, NO DICE. They wanted it paid in FULL and right NOW. So that was that, and we started contemplating BK.