Bankruptcy and credit?

Question

I think i want to file bankruptcy. I have store and bank credit card debt and loans. My husband lost job and i dont make enough to pay off our debt. we are about $4,500 in debt and every month the interest and late fees rack up and paying the $10 a mo minimum is getting me NOWHERE fast! I am in a world of hurt here and i think bankrupcy is the only way. how long after does it take to build up good even average credit again? can you find a rental even?

Answer 1

would you rent to somebody who went bankrupt because he couldn't pay his bills? i think not as you don't know if you would get your rent money. so think about that before you do it. if i was you i would talk to the creditors and explain the situation. they may be able to help you until you get back on your feet. or you can go to a credit counseling agency that will also help you. go to one that wont charge you though.

Answer 2

$4500 is not big enough to file bankruptcy. I know you dont make enough but filing bankruptcy for $4500 seems ridiculous as this will stay on your report for 10 years. Get a loan from someone (your family or friends) if you can and pay off the credit cards and pay the person off. You dont have to get all $4500. Get as much as you can and pay off the credit cards. You can try getting a fixed installement loans from your bank for 4500 and pay them off. For $4500, bankruptcy is not a viable option. Not my place to say but get a 2nd job on the weekends (you or your husband) and pay it off. You will be home free in 12-18 months if you get a 2nd job. I know sometimes it is not an option and I dont know your family situation.

Answer 3

IT takes 7 yrs to clear on your credit report. any credit card you get after the Bank. you will have a high interest rate. most likely pay high fees just to get another card, hard to get any load or house also.  maybe you can get a hold of a company who can try to settle up on your accounts ans save money and try to work it out. It will also be hard to get a job or rental. with a bankr., almost everyone checks credit these days good luck...

Answer 4

For $4,500 in debts, you are not bankrupt.

You don't have a debt problem, you have an income problem.

And you can find a job in a lot less time than a bankruptcy would be on your credit.

You just need some hope and patience.

SHORT TERM: (like, today)

Live Like No One Else

1) Nobody gets a dime until the essentials are paid off.

2) No more borrowing.  EVER.  Starting right now.

3) It's time to have "the mother of all garage sales".

4) Start job hunting (both of you.)

Here are the essentials (we're talking survival here)

Food

Shelter/Utilities

Clothing

Transportation

FOOD = Beans & rice.  Mac & cheese.  Ramen noodles.

I managed to cut my food budget down to $11/week when I was unemployed, but still managed to eat like you'd expect a 300 pound guy to eat like.

And if there's an Aldi in your town, you can cut it even further.

The only time you go inside a restaruant is if you're waiting tables.

Is it pretty?  No.  Will you avoid starving? Yes.

You can get steak and lobster after you get a job and pay off your debts.

SHELTER

The mortgage/rent, the electric bill, the water bill, etc.

If you have to dump the cable/internet, do it.

Again, the bare necessities.

CLOTHING

Stretch the budget.  This is an emergency.

TRANSPORTATION

Gasoline, Car Insurance, Car maintenance.

Credit card companies may scream and holler, but if you can start paying them again in 3-6 months, no-harm-no-foul.

--------------------------

LONG TERM

(After one/both of you have a job again and got a couple paychecks)

1) READ MY LIPS, NO MORE BORROWING.

Cut up the credit cards,

Cut up the store cards,

Act your wage.

2) Once you have money again, you can start attacking the debts.

THE BUDGET (after you have jobs again)

1) Every month starts with a detailed written budget.

Before the month begins, every dollar you two make will be allocated on paper, on purpose.

If you're a free-spirit and your husband is a nerd, then he can write up the budget, crunch the numbers, and get into the detailed stuff.

2) On payday, the two of you have a "budget committee meeting."

He hands you the budget. Then, he has to shut up.

You read the budget, make a couple changes:

"um, honey, where you put $500 for golf and $20 for food, I think we need to switch those"

Then, once the two of you agree, that's your budget for the money.

Stick it on the fridge.

"Whatever you want, dear" is NOT part of this process.

3) After the month begins, the two of you need to stick to it.

Before the month begins, you're the boss of the budget.

After the month begins, the budget is the boss of you.

--------------------------

THE REALLY LONG TERM

Step 1) Save up $1,000 cash in the bank.

Step 2) Start attacking the debts, one at a time, from smallest to largest.  

It may take a year or two, but it'll be worth it.

Step 3) Save up an emergency fund.

If you had $20,000 in the bank and your husband lost his job, he'd start looking for another one, but you wouldn't be feeling this terror of "are we going to eat?"

Step 3.5) Bigger emergency fund - A down payment on a house.

Step 4) Only now, start investing.  And go large (15%)

Step 5) Save for the kid's college.  $2,000 into an ESA

Step 6) Attack the mortgage.  And when it's paid-in-full...

Step 7) Live Like No One Else.

Answer 5

Definitely not enough debt to file bankrupty which will stay with you forever and adversely affect your credit score for 10 years.

How about checking credit counseling first:  http://www.nfcc.org/.  This is Consumer Credit Counseling Services (CCCS).  They can review your finances and advise your how to proceed.  They have debt management program available, if you qualify.

You may also want to call the creditors and ask for lower interest or to work out something till your husband finds another job.  If you are up front with them, they will often work with you.

Look for ways to bring in cash -- garage sale, collect alum cans, sell blood, get a second job, mow some lawns ...

Answer 6

Hi,

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