relocate or file?

TheCommuter, BSN, RN · Jul 21, 2010

Is there any possibility that you can stay in your area without filing for bankruptcy? There's no guarantee of a job if you relocate since even the most experienced nurses have been having it tough in various job markets.

In addition, do you really need new cars every few years? Do you really need to obtain another credit card after filing? People typically file for bankruptcy due to debts. Upgrading to a new car every few years adds debt, as does credit cards. The same vicious cycle might repeat itself. A good used car, no credit cards, and some financial behavior modifications might be wise. Good luck to you!

Medsport, LPN · Jul 21, 2010

I understand what your saying. I know you don't "need" a new car every few years, but I like to have one as its my only real vise as I don't have any of the "toys" most people have such as motorcycles, snowmobiles, 4 wheelers, jet skis, boats, ect. I don't have any hobbies besides working out and don't take vacations either. As far as the credit cards, I'm in the process of getting a debit card and plan on learning how to use that to buy things with the cash I have in the bank. But I do plan on getting a couple credit cards after I file to help rebuild my credit. You just have to have some willpower and only charge small amount and pay it off every month. In the past the majority of mine was used to pay bills and get groceries while going to school and to fill the gap afterwards when I was'nt making enough to pay the bills every month. I should finally be making enough with my raise, but still won't be able to pay the credit cards off for a good 8-10 years or pay down the home equity if I don't file (or find a higher paying job, which isn't available in this area).

Jules A, MSN · Jul 21, 2010

Please respond with your insight when you see the numerous threads about people who feel the need to encourage others to take out mega loans for living expenses so they can quit their job and "focus on school" because it is an investment in their future. :down: It doesn't really sound like you are willing to make changes and that will likely result in the same situation all over again. FWIW having a new car every few years is only a necessity if you can afford it and you obviously can't. Whether or not everyone else has snowmobiles or whatever is irrelevant. I'm sorry if this sounds harsh but you have made some not so great choices and I think doing a reality check might help you avoid a similar situation in the future and at your age it is time to get your financial life in order, imo. Good luck to you.

chloecatrn · Jul 21, 2010

Dave Ramseys My Total Money Makeover: Beat Debt. Build Wealth.

Try Dave Ramsey's Total Money Makeover. He talks about snowballing your debt, or paying off the highest interest credit card first, then using the amount that you'd have paid to that card combined with the amount you pay the second highest card to pay the second highest card off more quickly, etc.

You don't need a new car every four years. You only need a new car every four years if you can afford it, which you clearly can't. If you'd like a new to you car, then buy used, and buy only what you can afford. If you declare bankruptcy, you'll not be able to get the credit to get a car loan to get a new car every four years anyway. Nor are you going to be able to get credit cards to "rebuild your credit". Since the subprime lending crisis, NO ONE wants to touch someone with sub-par credit, and that's what you'll have post bankruptcy.

Your lawyer's advice was lousy. Call each of your credit card companies YOURSELF and see what you can do to get back in their good graces. Ask if they have a repayment schedule that will allow you to drop your interest rate. Call your student loan company. See if you qualify for Income Based Repayment, or if you can go into forbearance until you get straightened around. Your student loans will not be discharged in bankruptcy, so you'll still have those to pay on. There's a good chance that this will also affect being able to get a job, being able to rent or buy a new place to live.

It's a little terrifying that you're 40 and are just now "learning how to buy things with the cash [you] have in the bank". Moving to Long Island (or anywhere else) is not going to solve your problem. Fiscal responsibility will. Good luck.

Medsport, LPN · Jul 21, 2010

Thanks for the advice chloecatr, but I'm not sure how accurate your information is? I might check that link out, but it looks like he wants money for his advice like everyone else. I know the lawyers advice wasn't the best now, but the damage is already done and I feel like I have no other choice at the moment. I know there are hardship programs out there for some of the credit cards, but even if they can reduce the interest for awhile as far as I know you still have to pay 2% of the balance and that would be around 360/m now, which would have been about 320 before I stopped paying. At that amount I still won't be able to break even with my raise and will have to rely on working at least 2 days a month at my PRN job, which seems to be stable right now, but as you know is not guaranteed. Plus, like I said before, if I was to file I could afford a basic health insurance plan (which I need since I have a medical condition) and I could start paying my home equity down because if I don't a lump sum payment of 13k will be due in 4 years and I won't be able to pay it down if I don't file and I would also like to start a savings account for emergencies and/or retirement. All of this will be put off for at least 10 years if I don't file.

I already called about the student loans. That Income Based Repayment program would have reduce my payment by about 75 before I got the raise, but they said almost all of that goes to interest so its just like prolonging your payments until you make more and then they increase it. About the only thing that would really help would be if there was an interest reduction like the government just passed for new loans, but I'm stuck right now because mine were taken out before 2007. I already went the forbearance route several times and each time your payment goes up and also the balance when you resume payments. I have heard it goes into some time of forbearance that does'nt accumulate interest during the filing process. I'm not sure if this is true, but it has happened to some people who have filed.

I guess the "learning how to buy things with the cash" was a bad choose of words. I know it is something I'm just going to have to do from now on. btw, I know for a fact that you can get credit cards after filing as my sister has and people on the credit forum have also. Granted it is usually a high interest and low balance card to start, but you just make small purchases and pay it off every month and in 6 months to a year you should get interest reductions, higher limit and/or a lot more offers for better cards. Now for auto loans, it is a tougher question. People have gotten loans soon after filing with fairly high interest and it does go down with time, but I can't seem to get any answers how much it goes down and how long it takes to get near a "normal" interest rate. But like I said, I have a lease for the next 2 years and I'm thinking I should be able to buy that out at the end if I can't get a decent rate or trade it in on another car at the dealership. If not I may have to get a certified pre-owned vehicle.

I've found that bankruptcy really is'nt really as bad as people think it is after doing some research and hearing what people say who have actually gone through it. The media and credit card companies make it seem like its a failure or something and people buy into the "boogie man" fears of filing. The truth is bk lets you define the terms to exit debt instead of being controlled by creditors and collection agencies. I know I'll have to make some changes and the biggest will be the new car thing every few years, but I never have had the problem of going out shopping to get "things" as I don't have much now. About the only things I'm a little worried about in filing is putting a washer on one of the credit cards about a month ago (although I am still paying on that card) and renewing my nursing license on a card I stopped paying on as I had no choice for that one. I'm not sure what to do for that? I'm thinking at least pay the amount of the charge as there is no way I can afford the min. payment which is two months payments and two late charges.

happy2learn · Jul 21, 2010

I'm not a Dave Ramsey fan. But I do agree that a new car every few years may be a bit excessive, but that's just my opinion.

There comes a point when you just have too much debt and when you've tried everything, bankruptcy is the only option. I've looked into every option, and nothing is working. This is my only option. I've been living on a cash budget for 2 years now. But I have no cash to pay my debt. I make it by. So I'm going to file to get rid of my debt and give myself a fresh start. I wish I knew everything I knew now when I was 18 & 19. I wouldn't have racked up this debt and put myself in this position. But the only thing I can do is file and start from scratch.

I think you need to join this forum

Bankruptcy Forum

I'm filing for bankruptcy pro se in the next few months. You will get non-judgmental advice on that forum. They are all very helpful.

happy2learn · Jul 21, 2010

I guess the "learning how to buy things with the cash" was a bad choose of words. I know it is something I'm just going to have to do from now on. btw, I know for a fact that you can get credit cards after filing as my sister has and people on the credit forum have also. Granted it is usually a high interest and low balance card to start, but you just make small purchases and pay it off every month and in 6 months to a year you should get interest reductions, higher limit and/or a lot more offers for better cards. Now for auto loans, it is a tougher question. People have gotten loans soon after filing with fairly high interest and it does go down with time, but I can't seem to get any answers how much it goes down and how long it takes to get near a "normal" interest rate. But like I said, I have a lease for the next 2 years and I'm thinking I should be able to buy that out at the end if I can't get a decent rate or trade it in on another car at the dealership. If not I may have to get a certified pre-owned vehicle.
Some people can get loans the day after discharge (some with high rates, others with low). Some wait months, others may wait a year. It all depends on how quickly they rebuild their credit after they file.
I've found that bankruptcy really is'nt really as bad as people think it is after doing some research and hearing what people say who have actually gone through it. The media and credit card companies make it seem like its a failure or something and people buy into the "boogie man" fears of filing. The truth is bk lets you define the terms to exit debt instead of being controlled by creditors and collection agencies. I know I'll have to make some changes and the biggest will be the new car thing every few years, but I never have had the problem of going out shopping to get "things" as I don't have much now. About the only things I'm a little worried about in filing is putting a washer on one of the credit cards about a month ago (although I am still paying on that card) and renewing my nursing license on a card I stopped paying on as I had no choice for that one. I'm not sure what to do for that? I'm thinking at least pay the amount of the charge as there is no way I can afford the min. payment which is two months payments and two late charges.

If you made a purchase and never paid on it (within the past 90 days), the creditor will file a motion to make sure that debt will not be discharged. And it won't be. It's best to wait at least 6 months from the purchase, though there is still no guarantee that they won't come after you. Worst case scenario though, you'll have to pay for that purchase.

TheCommuter, BSN, RN · Jul 21, 2010

I know for a fact that you can get credit cards after filing as my sister has and people on the credit forum have also. Granted it is usually a high interest and low balance card to start, but you just make small purchases and pay it off every month and in 6 months to a year you should get interest reductions, higher limit and/or a lot more offers for better cards.

People have gotten loans soon after filing with fairly high interest and it does go down with time, but I can't seem to get any answers how much it goes down and how long it takes to get near a "normal" interest rate.

I've found that bankruptcy really is'nt really as bad as people think it is after doing some research and hearing what people say who have actually gone through it.

I strongly suspect that you already have your mind made up on the manner in which you'd like to proceed, based on these aforementioned quotes. I wish you the very best of luck.

Jules A, MSN · Jul 21, 2010

I've found that bankruptcy really is'nt really as bad as people think it is after doing some research and hearing what people say who have actually gone through it. The media and credit card companies make it seem like its a failure or something and people buy into the "boogie man" fears of filing. .

It does sound like you have already decided and that is your right. I know there are instances where this is the only option for people but it is a failure of sorts especially in the case of simply living beyond your means. Sorry but from someone who drives a 10 year old car and has a washing machine that is 20 years old I would expect someone at your age to be a bit more insightful to the fact that there are people who will be paying for your lifestyle choices when you file.

Medsport, LPN · Jul 21, 2010

My lifestyle choices? 99% of my debt was on necessities while going to school twice and were for living expenses and groceries mostly. I have nothing new as far as furniture, clothing, ect. Heck I've been here 12 years and still have'nt bought a coffee table and use a tv tray. Granted I did buy the cheapest new washer I could find. But that was after a 2 month struggle of going to the laundromat (which is'nt cheap), trying to find a decent used one and deciding what to do. I finally found a used one that "supposedly" worked. It took us about 5 hours of borrowing a truck, picking it up, cleaning it, ect. just to find out it leaked all over. I even tried to get the old one working by getting parts for it, but it rusted so bad the agitator basket broke in two! Anyway, thanks for the advice guys and the link happy2learn. I'll check it out. btw, I was already going to the credit forums as it has a decent section on bankruptcy and all type of credit topics. Another source of info could'nt hurt though.

Jules A, MSN · Jul 22, 2010

My lifestyle choices? 99% of my debt was on necessities while going to school twice and were for living expenses and groceries mostly.

Living expenses while in school twice? I hear what you are saying but don't necessarily agree. I continued working while in nursing school so I could pay my tuition and my bills.