File Chapter 7 or try to pay it myself?

[hodafez]

I have about 32k in debt including credit cards, auto loans, etc. Currently I am unemployed but hopefully soon will be working again. I will be making about $15/hour working full time. I am wayy past late on all of my payments and most (75%) of my debt are in collections. Should I try to negotiate my debt with each creditor myself and agree on monthly payments or file either Chapter 7 or 13?

[SinkingFast]

You won't qualify for a Ch 13 if you're unemployed at the time you file. In order for a Trustee to Confirm a Ch 13 payment plan, the Trustee has to have reasonable belief that you can meet your payment obligations. If you're unemployed you can't make payments.

Whether to file at all or try and work with the Creditors will kinda depend on how soon you get to go back to work. At $15/hr, you'll gross in one year pretty close to the total amount of your current debt level. If you get to go to work soon and don't create any new debt, it could be doable to work out payment arrangements that could get you out of debt in about the same amount of time as a DMP or Ch 13 would. And if you do it on your own, you won't have the Credit Score hit of BK or a DMP.

A lot will depend on the Creditors, and what they will want you to do in the way of payments. If the Creditors are unrealistic in their expectations, then BK may be your only answer. And, of course, when you start getting paid figures in there as well.

Another thing,.......... Are you talking Creditor Internal Collections or 3rd party Collections Agency Companies?? If you've moved from Internal Collections to an outside company, and your accts have been there a while, you may not have long before Law Suits begin. That could have a bearing on what decision you'll need to make.