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Posted: 8/1/2005 12:10:06 AM EDT
[Last Edit: 8/1/2005 12:10:54 AM EDT by southeast_scrounger]
OK, so I'm recently divorced (almost a year now) and have some debt. Not too bad, about 5 grand. Problem is I make far less than my ex used to bring in, and am forced to work part-time in the winter as my employer scales back operations. Opportunities are scarce on this Alaskan island and making extra dough isn't easy. I live a very spartan lifestyle and budget as well as I can, but my crappy credit and the high interest rates are killing me. I make my monthly minimums, but just barely.

Without being considered a deadbeat (I make my child support payments like clockwork) or lazy (I load cargo planes 10 hours a day, 5 days a week in the summer) i feel as though I may have to file Chapter 7 bankruptcy to survive. I owe one credit card $3500, though I haven't charged anything for a year. It's the interest that's a killer. I know, it's my own damn fault, but I didn't see the divorce coming until it was too late. I had two choices: Stay with a spouse that earned big bux and cheated multiple times, or split with the shirt on my back and my pride, as well as health. Now I'm broke but free.

Any advice on filing? I don't plan on major purchases anytime soon and my credit is already skunk. I just need to be able to rebuild. My budget already includes bare minimum groceries and beater car, and I'm still barely treading water. I'm no freeloader by any means, and refuse public assistance. I don't think a payment plan will work in my situation, as there is barely enough to keep the lights and heat on in the winter as it is.

Feel free to flame away, but consider that this was a surprise divorce after 10 years of supporting a wife as she climbed the corporate ladder, using me as the bottom rung. Thanks for any advice, guys.


Link Posted: 8/1/2005 12:18:42 AM EDT
[Last Edit: 8/1/2005 12:23:37 AM EDT by FieroLoki]
Dont do bankruptcy over 5 grand.. Call the CC and see if they will work with you in your situation.....It will cost 1 grand or more to even do bankruptcy..... Cost me $1500 when I did mine.
Link Posted: 8/1/2005 12:30:00 AM EDT
[Last Edit: 8/1/2005 12:30:12 AM EDT by Ineedhelp]

Originally Posted By FieroLoki:
Dont do bankruptcy over 5 grand.. Call the CC and see if they will work with you in your situation.....It will cost 1 grand or more to even do bankruptcy..... Cost me $1500 when I did mine.




BIG +1

Dont even think about it unless your at least 30 grand in the hole.
Link Posted: 8/1/2005 12:31:32 AM EDT
Yowch! Things mighnt not be as bad as I thought. Thanks for the advice....I'll look into it.
Link Posted: 8/1/2005 12:48:37 AM EDT
Sue her for alimony.

CW
Link Posted: 8/1/2005 12:49:03 AM EDT
HAHAHAHAH!!! SCORE!!!!


Originally Posted By Cold_Warrior:
Sue her for alimony.

CW

Link Posted: 8/1/2005 12:50:45 AM EDT

Originally Posted By Cold_Warrior:
Sue her for alimony.

CW




Seriously. Why not?
Link Posted: 8/1/2005 12:52:16 AM EDT
I considered it, but many factors made me want out quick and clean. Ironically, karma has come around to make her life a pretty crappy place to reside.
Link Posted: 8/1/2005 12:56:52 AM EDT
Any questions feel free to IM me....... Im on my 3rd year of filing.
Link Posted: 8/1/2005 1:01:15 AM EDT

Originally Posted By Gunbert:

Originally Posted By Cold_Warrior:
Sue her for alimony.

CW




Seriously. Why not?



Nuke her from orbit! Its the only way to be sure!
Link Posted: 8/1/2005 1:31:28 AM EDT
[Last Edit: 8/1/2005 1:34:06 AM EDT by southeast_scrounger]
Citabria, great post! I actually had a good laugh. It's tough, karma has paid her a visit and the good job evaporated, as well as the guys that she ran with. It's rough for both of us, but I feel like my situation is worse, as she has college edumacation, and I have none.

Unfortunately, to make the situation much more complicated, she has a recently discovered 'dark mass' on the right side of her brain that the doc is very concerned about. She's done the MRI and long needle biopsy, and we're waiting results. I would love to straighten out my stuff just in case. I don't love my ex the way I used to, but she is still family..ant the thought of my little one losing her mother keeps me up way way too late every night. I guess I'm looking for a quick fix to my financial platform just in case, though God willing that doesn't happen. I'm really torn between priorities..I'm helping with the medical, and counselling for my daughter, but how do I avoid getting reattached with the ex? We're all going to get hurt one way or the other, and I feel shallow trolling for advice about money. But I may be in a tough spot as a sole provider someday, and would like to do it right.

If I go bankrupt for now, and can have some discretionary income to help out later, I'd gladly do it. The thought of my little girl stuck with a broke-ass dad and no mom wrecks me in a way I didn't think possible. I just would love the resources just in case.

Crap, I'm only 36, kid is 9, and her mom might be in trouble.

Taxman, I've worried about ya in the past with some of your posts. It can always get worse no matter what. I hope you find what you need to get you through. I'm sure my solution will appear, cuz it can't get much darker at the moment. I know my situation has nothing to do with yours, but if I can hang you can too.

Link Posted: 8/1/2005 1:37:00 AM EDT
Again, if your only 5k, call the CC companies and work with them. Dont blow 7-10 years of having the bankruptcy over 5k.....Sorry to hear of the situation though. You said "you dont love her like you used to" do you still just "love" her? If she cheated, yeah I can see its not the same. Wqell, dont really know what the crap im trying to say....Lemme go think on it.
Link Posted: 8/1/2005 1:42:40 AM EDT
Thanks, Fiero. I'm in that wacky post divorce stage where I remember how it was (or so I thought) and still care...but on a not-quite-family and you-betrayed-me level.

I'd still never abandon her since she's my little girl's mother. But reconciling finances vs. a young life lost really really sucks. I'd never have thought my baby's mom would face passing at 34.
Link Posted: 8/1/2005 1:51:54 AM EDT
Definantly a hard position your in.....
Link Posted: 8/1/2005 1:58:36 AM EDT
Yep, I've got a good network with family and friends, but any extra helps. It's always good to bounce ideas off of the hive mind.

I may take the bail out on bankruptcy just so the slate is somewhat clean just in case. Nothing is really clear at this point. Thanks for your insights.
Link Posted: 8/1/2005 2:07:24 AM EDT
Take the money its gonna cost and put it on the CC, you may not even be able to file with the new laws out concerning bankruptcy.
Link Posted: 8/1/2005 3:13:32 AM EDT
I of course don't know all your details but bailing out doesn't seem the way to go.Put some hard effort into trying to come up with some better work lined up for this winter or some other kind of part time work right now. Bankruptcy right now will get you back to zero but your earning potential leaves you teatering right at the edge. If you can somehow improve your earning potential you can wipe out your debt and be in a better place for the future.
Is there any low cost (community college ,tech school,or high school adult education?) training available to you that would give you a beter earing/job potential? Computer skills,HVAC,welding,mechanic training,electrition training are a few that come to mind.One place to check is the local unenployment office,they might be able to direct you to some reasonable training. My point here is to build on some skill or training you have or go in some totally new direction to gain a skill that will increase your ability to secure a better income.
In other words your problem is not your debt but your available income,that is what you should concentrate your effort on improveing.
I wish you the best of luck in getting thru these hard times
Link Posted: 8/1/2005 3:20:50 AM EDT
They have made it harder to declare bankruptcy, try a credit counseling service first.
Link Posted: 8/1/2005 3:26:18 AM EDT
Do not file for such a small amount of debt. It may suck for a while but get a second job and use that money to pay off the debt.
Link Posted: 8/1/2005 3:53:18 AM EDT

Originally Posted By TheWind:
They have made it harder to declare bankruptcy, try a credit counseling service first.




It is still easy to file, BUT the main differance now will be more people will be ordered to pay off a percentage of the debt, under a court ordered payment plan for 5 years. Nothing wrong with that.

The new BK regs make it more difficult to get a total debt wipeout.


After all, you took the money, you should have to pay it back. Not that I like the preditors that are called credit card companys at all, but when you dance with devil....you are going to get burned.

Link Posted: 8/1/2005 3:54:07 AM EDT
Looks like it all came back and bit her in the ass.

Things have a way of working out like that.
Link Posted: 8/1/2005 4:06:17 AM EDT
Be careful with the consumer credit counseling agencies. My mortgage broker told me that using one of them looks just as bad on a credit report as a bankruptcy. NOTE: I do not have any independent verification of this.

Link Posted: 8/1/2005 4:14:29 AM EDT
[Last Edit: 8/1/2005 10:41:53 AM EDT by skid2964]
I know it will be tough, but is there any additional part-time job you can do? You'd be surprised how quick that debt would go away if you work a job and spent all the money on reducing your debt. Even a crappy minimum wage job will at least get you moving in the right direction. I know you will have even longer hours, but you can sleep when your debt is paid.
Link Posted: 8/1/2005 4:37:44 AM EDT
I'm not an expert on bankruptcy but I would think if you called the credit card company, told them you were just divorced, couldn't make the payments as the account was now structured and were considering bankruptcy, that they would work with you rather than just having to write the debt off.

How about getting a new card with zero interest and transferring the balance to get some breathing room?
Link Posted: 8/1/2005 4:51:11 AM EDT

Originally Posted By skid2964:
I know it will be tough, but is there any additional part-time job you can do? You'd be surprised how quick that debt would go away if you work a job and spent all the money on reducing your debt. Even a crappy minimum wage job will at least get you moving in the right direction. I know you will have even longer hours, but you can sleep when your debt it paid.

AND he is off working EARNING money, not at home spending it.
Link Posted: 8/1/2005 4:52:19 AM EDT
You can plug away and pay off $3,500. I hung on by my fingernails and teeth for a couple years after my divorce, too. I was in a hole I didn't think I'd ever be able to dig out of. But I got my food bill down to literally almost zero, and bought all my clothes at Good Will. I heated with scrounged wood, and rode a bicycle everywhere. Anyway, although things are a little shakey still, I finally don't feel like I'm drowning. It was one of those "character building" experiences.

Link Posted: 8/1/2005 4:54:07 AM EDT

Originally Posted By Rodent:
You can plug away and pay off $3,500. I hung on by my fingernails and teeth for a couple years after my divorce, too. I was in a hole I didn't think I'd ever be able to dig out of. But I got my food bill down to literally almost zero, and bought all my clothes at Good Will. I heated with scrounged wood, and rode a bicycle everywhere. Anyway, although things are a little shakey still, I finally don't feel like I'm drowning. It was one of those "character building" experiences.


After my divorce I grew to love beans and hotdogs and those ramen noodles.
Link Posted: 8/1/2005 5:01:46 AM EDT

Originally Posted By VTHOKIESHOOTER:
After my divorce I grew to love beans and hotdogs and those ramen noodles.



I used to buy wheat, rice and oatmeal (sometimes a sack of hull-less oats for horses) in bulk, and that was about it. I was living in a trailer on a lake, so I could almost always catch fish, and I head-shot a LOT of ducks with a pellet rifle. And I did some foraging that Euell Gibbons would have been proud of - mushrooms, cattails, dandelions, poke, etc. It was even kind of fun in a way, and I have to admit that it was probably the healthiest diet I'd ever had. Still, I used to fantasize that my ex, her lawyer and the judge would someday have to live on as little as they 'sentenced' me to live on.
Link Posted: 8/1/2005 5:03:30 AM EDT

Originally Posted By Rodent:

Originally Posted By VTHOKIESHOOTER:
After my divorce I grew to love beans and hotdogs and those ramen noodles.



I used to buy wheat, rice and oatmeal (sometimes a sack of hull-less oats for horses) in bulk, and that was about it. I was living in a trailer on a lake, so I could almost always catch fish, and I head-shot a LOT of ducks with a pellet rifle. And I did some foraging that Euell Gibbons would have been proud of - mushrooms, cattails, dandelions, poke, etc. It was even kind of fun in a way, and I have to admit that it was probably the healthiest diet I'd ever had. Still, I used to fantasize that my ex, her lawyer and the judge would someday have to live on as little as they 'sentenced' me to live on.

I wasn't that hardcore, but for 2 months I lived in a shack on a mountain top. No electricity or running water. Just me and the dog. I stared at the wall a lot. Did a lot of reading as well.
Link Posted: 8/1/2005 5:09:42 AM EDT
Would it be possible to move to the mainland where there might be better payin work or more work suited to your job skills? I have no knowledge of the economy up there but if there is a Wallmart or big chain maybe you can get some weekend relief shifts to help whittle that debt down.

Since your work is seasonal maybe you could go on unemployment in the fall and then trickfuck the system by finding a cash job. I know that isn't right, but plenty of folks up north do that and this is a dire situation.

Good luck.
Link Posted: 8/1/2005 5:42:02 AM EDT

Originally Posted By TheWind:



After all, you took the money, you should have to pay it back. Not that I like the preditors that are called credit card companys at all, but when you dance with devil....you are going to get burned.




I just wanted to comment on this. Yes you took the money. BUT if you add up all the payments you have made since taking it all out I bet you would see how much you actually paid. CC companies PREY on people and the laws are all on their side. From a moral standpoint they are setup to get you into debt over your head and then keep you there. Paying the minimum takes many many years to pay off the balance. And it becomes inpossible to pay it off if you go over the limit or are late. $30 for a over the limit and $30 late fee. $60 in fees, and the interest keep pilling up. I don't feel bad AT ALL when people declare bankruptsy. The CC companies in many many cases have already gotten their money back WITH interest. The "balance" you see is from exorbant fees and interest payments, not the actual money you borrowed.

So from a moral stand point they are on the low ground. Don't "feel bad" or obligated to screw them. They are some of the lowest scum on the planet.

That being said. I would go to a credit service. They will get your fee's stopped and the interest reduced or eliminated. This is important as it actually allows you to pay the balance down. If the fee's and interest are not stopped you will never get the bill paid down. The services will help

SCAM ALERT. If you use a service some of the CC will tell you that it is not enough to needs to be in a certain day. This is a scam to get you to double your payments. I fell for this in my early 20's and it ended up making the whole house of cards tumble down. It is a scam!!!!! Route all calls through the credit counseling agency. Then change your phone number and have your mail forwarded to a PO BOX. This will buy you some privacy and peace of mind, and make you very hard for the CC to find. Make sure your new number is unlisted. Even better is to get it unlisted in a friends name if you have anyone willing to put it in his name. (If you do MAKE SURE you pay the phone bill on time every time, don't loose a friend over money.)

I would NOT do a BK for under 5K. Not even under 15K. After 15K it gets into the realm of inpossibility to pay off. If you decide to do a BK get more credit and a car loan if you can swing it and max it out on supplies that are not consumable. Not a nice thing to do but the CC companies are not nice either. But I wouldn't do it. You CAN get out of what you are in right now.

This biggest problem is your earning potential. You need to get some training. Discover in your area what are some indemand jobs and find out about training. You may be able to get loans, grants or assistance. You can even write local companies asking for help.

Let me tell you about my little bro. After leaving a cult that had me cut off from the familly for 10+ years and my parents deserting him after their divorce he wanted to go to college. He spent his seniour year as an exchange student in Korea and graduated college there. My dad got ahold of his AE card and charged up 2grand without his knowledge. Never paid the bill. He doesn't find out till he gets back. Infact none of his siblings or parents even told him about the divorce. My dad never paid the AE bill and it was not paid on for months. This got him into deep trouble. He couldn't get any student loans for school. He also couldn't get any grants, as my parents made too much. My parents and other siblings left him on his own. He wrote letters to companies, schools and politicians asking for help. He is a white male BTW. He has gotten enough to pay for his school and his housing. He still has to keep writing letters asking for help. Borrowed money from a firend to pay back AE and is almost done paying his friend back. Plus he has 2 years of school under his belt and continuing on. He will also graduate with no debt if he is able to keep it going. Though if he can qualify he will take out some loans, as the letter writing is exusting. And he is working 40-50 hours a week.

If he can do it so can you. But you NEED to improve yourself!!!! Then you can get out and stay out of debt. Always live below your debt.

And if you can save ANY money even $1 a month put it aside and DO NTO TOUCH IT. IT DOES NOT EXIST. Keep saving what you can untill you have $500. This is your emergency fund. I was always in financial trouble untill I got this and it was hard but after a few years I made it. This is for true emergencies. After some time you want your fund to be 3-6 months living expences. This is what will keep you out of trouble in the future. But start small now and don't touch it no matter what. If you can do that then you will have moved your self forward.
Link Posted: 8/1/2005 5:47:03 AM EDT

Originally Posted By FieroLoki:
Dont do bankruptcy over 5 grand.. Call the CC and see if they will work with you in your situation.....It will cost 1 grand or more to even do bankruptcy..... Cost me $1500 when I did mine.



+1

There are several private organizations that can help you out. Look in the phone book in your area.
Link Posted: 8/1/2005 6:12:54 AM EDT
[Last Edit: 8/1/2005 6:16:24 AM EDT by mobius]
ever consider becoming a man whore? there are plenty of old grannies out there that have disposal income
Link Posted: 8/1/2005 7:20:39 AM EDT
Credit "Counseling" Services are normally funded by the credit card companies and once you sign-on to a contract and make payments you are giving up your right to file for bankruptcy.

Now, first thing is to go to www.creditboards.com and read up on what others have done.

Second, try for another card with zero interest on balance transfers (for life). They are out there and love to transfer cash.

Lastly, if you cannot transfer the money, call the credit card company and request a freeze on interest, or a lower rate. Hell, if you qualify for another no or low interest card, you can always call and tell them the situation, explaining that you don't want to file for bankruptcy, but may have to. Then work out a "payoff", but make damn sure the payoff takes care of the entire debt, or they will send a collection agency after you later.

Filing for bankruptcy will hurt you more than if you simply stop paying. Either way it will trash your credit.

Go to the website I listed and read, read, read...

Good luck with it.

Eric

PS: If you are paying child support, than you should make an agreement with your ex that you get to claim your child on the tax returns. With child income credit, etc, you will have that credit card paid off in two years or so... Demand it as part of your divorce!!
Link Posted: 8/1/2005 8:28:12 AM EDT

Originally Posted By spartacus2002:
Be careful with the consumer credit counseling agencies. My mortgage broker told me that using one of them looks just as bad on a credit report as a bankruptcy. NOTE: I do not have any independent verification of this.




I would like to interject and comment on this note. You and your mortgage broker are correct, Consumer Credit Counseling agencies do NOTHING that you cannot do yourself and in fact are worse for you (from my personal experience). They negotiate a set payment with the debtors and take the payment from you (for a fee of $50+ per monthly payment) then pay the debtor.

You can call your CC and tell them yourself of your situation. Tell them you are very interested in NOT having a bancruptcy on your record or 30, 60, 90+ day late payments and that you would like to pay them off in FULL (do NOT do a settlement as the unpaid balance will reflect poorly on you and your credit). The CC company will want to work with you because in the end they want their money and bankruptcy or counseling agencies only delay/interrupt this.

There has been a lot of talk on this forum about Dave Ramsey's book The Total Money Makeover. I've recently finished reading it and it has been a HUGE eye opener...check your PMs and try to avoid bankruptcy if at all possible.
Link Posted: 8/1/2005 8:33:12 AM EDT
[Last Edit: 8/1/2005 8:37:09 AM EDT by legalese77]
There is some misinformation in this thread. I would find an attorney that will consult with you for free and discuss your options. I would tend to agree with those that have said 5K of unsecured debt does not warrant a bankruptcy.

Although bankruptcy rules have been changed, the new rules are not yet in play but will be in the relatively near future. Get a free consultation and good luck.
Link Posted: 8/1/2005 9:03:40 AM EDT
Do the balance transfer to a new 0% cardthat should buy you some extra time to pay without interrest or call the cc company and tell them you are considering changing companies to one with a lower interest rate. They may drop theirs

Make a budget and use it.


Check out Dave Ramsey (sp) http://www.daveramsey.com/. He has some good forms and budgets you can use.

Don't file for 5K.
Link Posted: 8/1/2005 9:20:56 AM EDT

Originally Posted By JIMBEAM:

Check out Dave Ramsey (sp) http://www.daveramsey.com/. He has some good forms and budgets you can use.




I browsed that site for about 5 minutes, couldn't find anything but crap about FPU (Financial Peace University). Looks like all he wants to do is sell you course materials or to pay to attend a course.

I listen to Clark Howard since he's on my local talk radio station, his site has lots of good and free information Clark
Link Posted: 8/1/2005 9:44:52 AM EDT
Asking for a lower rate is all fine and good until they turn around after saying no and raise your rates citing a concern on your ability to pay.

CC companies suck, I loathe them.

Link Posted: 8/1/2005 9:49:00 AM EDT
I could be wrong, but I believe as of December, you can no longer clear your credit card debt through bancruptcy.

Hopefully, somebody will be along with the facts. Anybody?


In any case, $5000 is not nearly enough to be considering that option. You sound like a man who still has his pride. Don't forget to factor in the damage to your self confidence when you consider bancruptcy.

Also, many potential employers will do a credit check as part of the interview process. For 20-30 thousand it might be a viable option, but not for 5.
Link Posted: 8/1/2005 9:50:48 AM EDT

Originally Posted By BillofRights:
I could be wrong, but I believe as of December, you can no longer clear your credit card debt through bancruptcy.

Hopefully, somebody will be along with the facts. Anybody?


In any case, $5000 is not nearly enough to be considering that option. You sound like a man who still has his pride. Don't forget to factor in the damage to your self confidence when you consider bancruptcy.

Also, many potential employers will do a credit check as part of the interview process. For 20-30 thousand it might be a viable option, but not for 5.



You can clear cc for bk. New law sn not effective until Oct. I think and then if you qualify for a chapetr 7 you still can. Depends if you pass the test for 7 or 13.
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