Anonymous wrote:

You are starting to make more sense now. You agree that it is doable in 3 years instead of 5-7 that you claimed before. It actually takes less than 3 years to pay off 55k at 10% if you pay 2k a month which is what OP pays currently.

I dont know if bankruptcy is a better option for her. She might or might not qualify for chapter 7 with her income. Maybe it is worth exploring as well. And maybe don’t exaggerate and use a calculator next time and you come across as more credible

Anonymous wrote:I have about $55K of credit card debt and $27K of auto loan. Overall, my minimum monthly payments are about $2700-2800 when my take home per month is about $4500 as a nurse making $60-65K/year. On top of debt, I still have to pay rent, utilities, groceries, gas, etc. I stay very depressed that I would never be able to get out of this. I want to go back to school to get advance nursing degree(paid by hospital) but have to adjust on my hours.

I am 42F and single.

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You are thinking Op would do chapter 7 but I think chapter 13 is going to be much better if she wants to keep her car, retirement etc. chapter 13 is reorganization of debt and you still end up paying some of the debt including CC. Creditors have gone smart about it and it’s not as easy as it looks. Dealing with lawyers and paying them is another concern.

Chapter 7 is fine for OP. She has almost no assets. No house, I’m sure no savings or investments, no expensive art or musical instruments.

If she sells the car and buys something cheap for cash she will be fine there too. I think about a $5000 worth of car equity will be exempt from consideration if you file a chapter 7 bankruptcy.

All you guys going on and on about how bad a chapter 7 bankruptcy is? I think you’re approaching it from your own mentality where you do have assets to protect, where you have a house you wanna keep. You probably have savings in retirement that you could use to pay off debt. You just are having trouble paying the debt. You may be younger, married, with higher income and less debt.

Sure, in that case restructuring the debt and working out payment plans, buckling down for a few years makes sense.

OP’s situation is very different. Her earning potential is low in the future unless she goes back to school.

Her health is poor, at 42. It’s not gonna get better. (“lose weight “is not very useful or actionable advice right now.)

She has very little to lose in filing for bankruptcy, section 7. She has no assets that she’s gonna lose. The only thing she’s gonna lose is an ability to borrow more money for several years. But she’s not supposed to be borrowing money anyway right? The biggest concern is if it impacts her ability to rent an apartment. But she’s a single child free adult. She can handle a little instability in her living situation. It’s not like she needs a place for her little kids to live. There’s always someone who will rent you a room and you can deal with a lot for just a year or two until you find yourself back on your feet.

And someone asked why it’s so important for somebody to buy a house or a condo? That’s because a key to retirement is having a paid for housing situation, a pension hopefully, Social Security, hopefully and a nest egg to give you some more income in retirement sure if you have a great pension and a great Social Security Benefit, and great retirement savings of your own, a paid off house or condo is less important than.

But either way, if OP spends the next 5 to 7 years, trying to pay down this debt that is equal to her current income, she’s going to end up starting her fifties with no down payment for a mortgage, no significant retirement funds started, and no ability to earn more income in a less physically demanding job. There’s literally nothing of benefit to her if she doesn’t discharge the debt.

Before advising OP to file for bankruptcy look at the numbers. All she needs is to work with a debt management non profit to negotiate a 10% interest rate on her credit cards. If she does that she can pay off her debt in 2-3 years while keeping her apartment and car instead of renting a room from a stranger and driving a beater per your scenario

Anonymous wrote:

Anonymous wrote:
Before advising OP to file for bankruptcy look at the numbers. All she needs is to work with a debt management non profit to negotiate a 10% interest rate on her credit cards. If she does that she can pay off her debt in 2-3 years while keeping her apartment and car instead of renting a room from a stranger and driving a beater per your scenario

Maybe... don't you think 2-3 years is pretty unrealistic?

$55000 in debt. at 10% interest, I'm seeing she'd have to pay $1774/month for three years to pay it off.

Pluse her $700 car loan? OK, maybe she refinances that to 7 years to be what, $500?

That's still $2200 a MONTH for three years. Yeah, better than $2700 that she's paying now, but still really tight on her take-home, and it doesn't leave much at all for saving for emergencies.

I have a HHI of $150,000 and I'd have a hard time paying $2200 a month in debt.

Do you work for the credit card companies or something? You seem to be trying to convince people that they should stay in debt, because they need to keep their nice car and oh, no, they might not be able to rent an apartment or something for EVER!

But I don't think bankruptcy ruins your life as much as you are scaring people into believing it will.

First off, she's renting an apartment, and paying the rent, right? As long as she keeps paying the rent on time (MORE LIKELY if she gets rid of her debt) she's probably going to be able to stay there. Landlords don't kick you out if you are a good tenant and pay on time.

I just was thinking of the worst case scenario, that if she lost your apartment for some reason and had to move, and had a low credit score, it's be harder to find a place to rent, sure, for a year or two. But there are always ways, and she's a single woman - pretty easy to suck it up for a year if you need to.

(And easier than keeping on paying $2200 every MONTH towards this debt for THREE YEARS.)

And then you are saying yeah, just keep paying the debt, so at least you don't have to sell the car and drive a ... shudder.. beater. LOL. Full disclosure, I drive a beater. It works fine. I can afford the insurance and the repairs. It doesn't look great, but it gets me to work and it gets me back home. People who are in overwhelming debt should NOT Be driving 2 year old cars. It's not the end of the world to drive a beater and it is MUCH better to be doing that, than to put your education on hold, and your financial security, to pay off this very high debt.

Here's the thing she really *should* be worried about - a period of disability where she is unable to work her physically demanding job. This sadly happens, and happens more often to women, esp over 40, especially those who are not in good health. It's why it can be hard to buy disability insurance if you have diabetes or any other health concern, such as high blood pressure or being overweight, sadly.

Look at her finances. ONE missed paycheck and she's going to have trouble just paying the rent. That's the thing that should be keeping herup at night, not a concern about having to drive a beater car or worry that maybe possibly, she might have trouble renting.

What good does it do to keep your credit score in the 600s but then lose your apartment because you became ill or disabled for three months and you were evicted from your apartment?

Anonymous wrote:
Before advising OP to file for bankruptcy look at the numbers. All she needs is to work with a debt management non profit to negotiate a 10% interest rate on her credit cards. If she does that she can pay off her debt in 2-3 years while keeping her apartment and car instead of renting a room from a stranger and driving a beater per your scenario

Anonymous wrote:

Anonymous wrote:You are thinking Op would do chapter 7 but I think chapter 13 is going to be much better if she wants to keep her car, retirement etc. chapter 13 is reorganization of debt and you still end up paying some of the debt including CC. Creditors have gone smart about it and it’s not as easy as it looks. Dealing with lawyers and paying them is another concern.

Chapter 7 is fine for OP. She has almost no assets. No house, I’m sure no savings or investments, no expensive art or musical instruments.

If she sells the car and buys something cheap for cash she will be fine there too. I think about a $5000 worth of car equity will be exempt from consideration if you file a chapter 7 bankruptcy.

All you guys going on and on about how bad a chapter 7 bankruptcy is? I think you’re approaching it from your own mentality where you do have assets to protect, where you have a house you wanna keep. You probably have savings in retirement that you could use to pay off debt. You just are having trouble paying the debt. You may be younger, married, with higher income and less debt.

Sure, in that case restructuring the debt and working out payment plans, buckling down for a few years makes sense.

OP’s situation is very different. Her earning potential is low in the future unless she goes back to school.

Her health is poor, at 42. It’s not gonna get better. (“lose weight “is not very useful or actionable advice right now.)

She has very little to lose in filing for bankruptcy, section 7. She has no assets that she’s gonna lose. The only thing she’s gonna lose is an ability to borrow more money for several years. But she’s not supposed to be borrowing money anyway right? The biggest concern is if it impacts her ability to rent an apartment. But she’s a single child free adult. She can handle a little instability in her living situation. It’s not like she needs a place for her little kids to live. There’s always someone who will rent you a room and you can deal with a lot for just a year or two until you find yourself back on your feet.

And someone asked why it’s so important for somebody to buy a house or a condo? That’s because a key to retirement is having a paid for housing situation, a pension hopefully, Social Security, hopefully and a nest egg to give you some more income in retirement sure if you have a great pension and a great Social Security Benefit, and great retirement savings of your own, a paid off house or condo is less important than.

But either way, if OP spends the next 5 to 7 years, trying to pay down this debt that is equal to her current income, she’s going to end up starting her fifties with no down payment for a mortgage, no significant retirement funds started, and no ability to earn more income in a less physically demanding job. There’s literally nothing of benefit to her if she doesn’t discharge the debt.

Anonymous wrote:Credit card companies are getting better in dealing with debt discharged during bankruptcy. I know they charge heavy interest but getting creative to get it out of bankruptcy filers.

Anonymous wrote:It’s going to be messy either way. This is a very bad situation for OP. Hope she gets out of it.

Anonymous wrote:They can take your retirement in chapter 7 if you want a quick deal with debt. These laws are there for a reason so that people intentionally can’t get away with it.

If you are considering filing for bankruptcy and are concerned about losing your 401(k), here’s some good news: In most cases, retirement accounts are considered exempt. That’s thanks to the Employee Retirement Income Security Act (ERISA), a federal law that regulates 401(k)s and other types of employee benefit plans.

Typically, under ERISA, creditors are not allowed to touch your 401(k) when you liquify your assets in Chapter 7 bankruptcy. Likewise, your 401(k) cannot be tallied among your assets when creating a Chapter 13 repayment plan.

Exempt assets: Retirement Accounts

Pennsylvania:

* pensions for city employees, municipal employees, police officers, public school employees, state employees

* private retirement benefits

* more protections in "Federal Nonbankruptcy Exemptions" below

42 Pa.C.S. § 8124(b)

Federal:

- tax-exempt retirement accounts

- IRA and Roth IRA up to $1,512,350

11 USC §§ 522(b)(3)(C),(b)(3)(C)(n)

Note: These retirement accounts are exempt under the federal rules even if the filer uses state exemptions.

Anonymous wrote:

Anonymous wrote:You are thinking Op would do chapter 7 but I think chapter 13 is going to be much better if she wants to keep her car, retirement etc. chapter 13 is reorganization of debt and you still end up paying some of the debt including CC. Creditors have gone smart about it and it’s not as easy as it looks. Dealing with lawyers and paying them is another concern.

Not to mention, it's debt she incurred and is responsible for...the whole "just declare bankruptcy" advice is insidious and a sign of what a crap nation the US has become. But might as well be like dear leader I guess? Trump is such a shining example of responsibility.

Anonymous wrote:Chapter 7 or 13. This is going to be very messy at this age. Op should pay if she could and get out of this debt.