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Thread: Calling all Financial Gurus! -- Chapter 7?

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    Calling all Financial Gurus! -- Chapter 7?

    I am so tired of all of these credit card bills that were leftover from when I separated from the Air Force 2 years ago. My separation was just like a divorce, and I am just feeling overwhelmed and tired. I've been paying them since I've been out, and I still owe a shitload of money. I just want out of this hole I'm in. I want a clean slate. I want forgiveness. Would filing a Chapter 7 be such a bad option for me? Help!



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    Banned i.breathe.in's Avatar
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    Default Re: Calling all Financial Gurus! Chapter 7?

    depends we need details. i just filed 13, so i might have some stuff to contribute.

    how much do you owe?
    how far behind are you?
    how is your credit?

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    I have 4 credit cards. I wasn't being irresponsible when I used them. The military moved me around so much the last 2 years I was in, and I had to buy furniture for my house along with other important things I desperately needed at the time. Also, I needed things to help me get into stripping when I got out-- and you know how expensive that is!

    CC#1- about $5,000

    CC#2- about $3,000

    CC#3- about $1,000

    CC#4- about $1,000


    So... about $10,000 worth of CC debt. SIGH!

    I'm behind on my last 2 cards, too, because of other emergencies that have popped up recently.



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    Banned i.breathe.in's Avatar
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    that is so not worth filing over. consolodate your cards onto one card if you can, if not pay off the ones with the highest interest rates first while making minimum payments on the others if you can.

    if he is partially to blame for the debt you can take him to court for that i would assume.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Quote Originally Posted by i.breathe.in View Post
    if he is partially to blame for the debt you can take him to court for that i would assume.
    Oh, I didn't actually get a divorce. I was just using that as an analogy to me getting out of the military.



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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ohhh....stil if he contributed to the charges, you could see him in court over it.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ^There is no HE. It was all ME, lol.



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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    lordy woman you confused the hell out of me.

    well either way not worth filing over. get a finantial book by suze orman that woman is awesome at helping people get out of debt and her plan isnt too hard to follow.. she has a book called women and money that i found very helpful.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Nope, dont waste your time filing for only 10K.

    Are you a member of creditboards.com ? It's the best credit building forum ever!! I've learned so much!

    My suggestion, start paying the one with the highest interest rate first. Pay them all, but pay the most of this one. I dont' care how broke you get, ALWAYS, always, ALWAYS pay at least the minimum balance.







    Some Douchebag: "[Pimp C] 12:43 am: its true we got to stick together the black people on SW CK you is teh condoleeza of SW"


  10. #10
    AudreyLeigh
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    No bk for you.

    Snowball those debts.

    Start with the highest interest one - pay as much as you can to it while paying the minimum on all others.

    Once that one is paid off take the money you were paying towards that one and add it to the payments on the next highest interest one and so on and so on until theyre all paid off.

    Heres a snowball sheet - it tells you exactly which to pay first and how much to pay towards each along with when each will be paid off. Once you have a plan you wont be so overwhelmed. Itll be an easy step-by-step.

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    God/dess VenusGoddess's Avatar
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    You wouldn't get a Chpt. 7 anyways. They would just put you into Chpt. 13. The "easy" Chpt. 7's ended a few years ago (October 2004, I believe).

    Just start paying down the debt slowly.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Thanks for all the tips. I've just never been in this much debt before. I've always had an almost perfect credit score until this year. I know it's not a lot compared to some people, but I'm starting to fall behind like I said. Also, it seems like everytime I get caught up, something stupid happens that stands in my way of trying to become debt free. I'm just looking at any options that I might have.



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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    just to include the info, the 2005 revisions to US bankruptcy laws made major changes in the 'qualifications' necessary to file a Chapter 7 bankruptcy ... i.e. a bankruptcy ruling where all of your delinquent debt is forgiven and you aren't required to make any further payments to your creditors. In order to file Chapter 7 today ...

    - your income over the past 6 months must be below the 'median income' for your area
    - your costs of living (i.e. cost of typical rent / food / utilities in your area) must be sufficiently high in relation to your income that you cannot afford to spend money on anything else

    If you fail either of these 'means tests' you will not allowed to file Chapter 7, and instead will require that you file Chapter 13, which involves a (typically) 5 year court ordered repayment plan to your existing creditors. Obviously a Chapter 13 bankruptcy means that your creditors must settle for reduced monthly payments, and must also settle for ultimately getting paid far less money than you owe them, but it also requires that just about every dollar that you earn over and above the amount necessary to meet basic costs of living must be paid to your creditors for the next 5 years.

    see for a fairly good breakdown.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    yes the means tests will kill you. the only way i got away with filing is i never filed taxes since started dancing so i filed low on the 3 years i had to file to be elegable for BR. and i had to include what i owed in my BR and all taxes have to be payed in full. what would have been a 5000 repayment is now a 10000 repayment....not worth it for you!

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    Veteran Member StuartL's Avatar
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Quote Originally Posted by AudreyLeigh View Post

    Snowball those debts.
    Pretty decent advice.

    Whatever you do, it should be worth bearing in mind that any sort of 'arrangement' as discussed above will damage your credit records very seriously for the next few years. I can't speak for anyone else, but I would have thought that maintaining your good reputation would be worth more than $10k.

    Good luck with it. Dealing with debt can be very difficult - but it takes time, patience and effort. I'm sure you can make it right if you are focused and disciplined.

    Best wishes,

    Stuart

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ^^^ there is also the dilemma (in the US at least) that emerging from a banrkuptcy filing DOES essentially leave you with a comparatively clean credit rating ... since US lenders are prevented from 'discriminating' against people with a previous history of bankruptcy if their post-bankruptcy credit rating is good.

    On the other hand, not filing bankruptcy and resolving your debt problems via negotiatiated short settlements with creditors, use of strong-arm credit counseling services, short sales etc. can leave your credit report full of 'deficiencies' (i.e. the reduced payments amounts resulting from negotiations / settlements continuing to appear as unpaid debts on your credit report). Without the legal nicety of a bankruptcy filing, these 'deficiencies' CAN be used against you by lenders as long as they continue to appear on the report. Thus some will tell you that the use of negotiated settlements and credit counseling services can have far worse future results than filing for bankruptcy.

    However, I fully agree that $10k is far too small of an amount to take to bankruptcy court. Get your current spending levels down to a minimum. Work some extra nights to boost your income. Prioritize the payoff of your outstanding debts, starting with the debts carrying the highest interest rates and penalties.

  17. #17
    AudreyLeigh
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Quote Originally Posted by StuartL View Post
    Pretty decent advice.

    Whatever you do, it should be worth bearing in mind that any sort of 'arrangement' as discussed above will damage your credit records very seriously for the next few years. I can't speak for anyone else, but I would have thought that maintaining your good reputation would be worth more than $10k.

    Good luck with it. Dealing with debt can be very difficult - but it takes time, patience and effort. I'm sure you can make it right if you are focused and disciplined.

    Best wishes,

    Stuart
    Do you even know what snowballing debts is? I said nothing about making 'arrangements'. Did you even look at the link or know what snowballing debt is?! I would never advise to work with a company. This is something she can easily do herself with no 'arrangements' of any kind.

    She has $400 a month to put towards debt.

    Debt 1 is $50 a month at 16%
    Debt 2 is $30 a month at 14%
    Debt 3 is $20 a month at 19%
    Debt 4 is $20 a month at 21%

    Pay minimum on debts 1,2,3
    On debt 4 (highest interest) pay all the extra from your $400 debt fund ($300 a month) until its paid off.

    Once debt 4 is paid off you go to the next debt with the highest interest which is debt 3 (in my scenario) So, now you pay the minimums on debts 1 and 2 but put all extra of your debt money towards debt 3 which would be $320 a month.

    When debt 3 is paid you go to the next highest interest debt (number 1) So now youre paying the minimum on debt 2 and all extra goes towards debt 1 ($370 a month)

    After that debt is paid you take your entire $400 and put it towards the last debt (number 2) until you have no more debt.

    So, before attacking someones post please make sure you know what their post was about.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ^ That's awesome Audrey. I'm passing that link on to a few friends.

  19. #19
    AudreyLeigh
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    That link is awesome... does all the work for you. Tells you what to do and even when youll be all done and out of debt. It is a great way to avoid those consolidation services or bankruptcy... had I not been so so so far over my head Id have done the snowballing module.

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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    Thanks for the linkage! Off to study!



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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    I've also thought about just getting a consolidated loan for all of these credit cards, so I can just have one payment to worry about. What do you guys think? Would a loan like this be hard for me to get being a dancer/independent contractor?



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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ^^^ an unsecured loan like that with a 'manageable' interest rate will be hard to get for anyone with a shaky credit rating. It will be even harder to get for an independent contractor business person who, in addition to a shaky credit rating, cannot prove / verify / project their income. That's not to say that obtaining such a loan is totally impossible. However, it's also possible that the interest rate being charged for any such 'subprime' unsecured loan will be higher than the interest rate on the pre-existing debts.

  23. #23
    AudreyLeigh
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    Default Re: Calling all Financial Gurus! -- Chapter 7?

    ^ Agreed. Your best bet is really the snowball sheet. You can always try prospect.com BUT they seem to give people very high interest so you wont really be saving money in interest but save sanity by only having one payment.

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