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Our Credit is in the Crapper. Should We Go With MMI? – Nannie

“Dear Steve,

I am contemplating whenter or not I should sign up with MMI–Our credit is in the crapper, due to over 4 years of underearning.

I finally got a job, my husband’s job is also steady and still we cannot manage. I had to take a long look at things and realize that we need extra help in terms of 1. Debtor’s Annonymous becuause we are compulsive spenders both of us and 2. Possibly look at bankruptcy or Money management.

I spoke with someone over at MMI and they feel that in 43 months we could be debt free by paying only $500 or so a month. That is doable and frankly I want someone else to do it. But I don’t know what it means in the long term. I wasnt to put his behind me will this follow us for the rest of our lives?

I would love your advice because I want to be able to plug the phone bak in. Lol Thank you.

Nannie”

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The Answer

Our Credit is in the Crapper. Should We Go With MMI?   Nannie

Dear Nannie,

If you want to enroll in a credit counseling program then MMI is a competent provider.

But the real issue here is if it is more important at this time to try to spend the next 43 months to try and fix the past or to deal with the past and and instead focus on doing better moving forward.

From what you’ve shared you are still limping along, just making it. That concerns me.

If you enrolled in the MMI program and were able to make their payment and still save for both your retirement and emergency fund, then that might be a good thing for you to consider.

However, if you enroll in the program and you can’t save for the future, then that would not be a logical or reasonable thing to do.

Let’s say you are in the MMI program for two years, limping along, and something unexpected happens or you have a spending relapse. Your repayment approach will run off the rails and you’ll probably have to look at bankruptcy. You will have wasted two years.

Do not avoid bankruptcy as a serious consideration here. Depending on your age, seriously contemplating bankruptcy might make better economic sense.

If you are paying MMI let’s say $50 per month for 43 months that fee will add up to $2,150 and it will take almost four years to get out of debt and then you’ll have to start rebuilding your credit.

If you consider filing bankruptcy it will typically take about 90 days to discharge your debt and will typically cost less than the MMI program. In three months you can begin rebuilding your credit and start saving again for retirement. Money you will desperately need most likely.

There is one other consideration that only you two can answer. Your compulsive spending was most likely due to a way to reduce stress or improve self-esteem. If you launch onto a tight monthly approach like MMI, are your underlying issues under enough control that they won’t break out in the next 43 months?

Are you honestly, and realistically ready to bury that chemical dependence your brain is drawn to from your shopping. Honestly?

I think you’d get a lot out of reading my free book, The Path to Happiness and Wealth. It will resonate with your journey at this point.

Money problems are just math wrapped in emotion.Click to tweet

Debtors Anonymous is a great group to help talk through those issues and deal with your addictive behavior. I applaud you for taking that step.

I’d suggest you first read How to Get Out of Debt. The Honest and Unvarnished Truth and The Truth About The Success Rates, Failure Rates and Completion Rates of Credit Counseling, Debt Settlement, and Bankruptcy. They will give you a great overview of what we need to deal with to get you moving in the right direction.

Then use the free How to Get Out of Debt Calculator to review your options.

Once you’ve identified a company you want to work with, then follow my step-by-step guide on what you should look for and expect from a good debt relief company.

Please post your responses and follow-up messages to me on this in the comments section below.

Big Hug!

Our Credit is in the Crapper. Should We Go With MMI?   Nannie
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If you have a credit or debt question you’d like to ask just use the online form. I’m happy to help you totally for free.

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About Steve Rhode

Steve Rhode
Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
  • Nannie

    Thank you so much. Can you tell me a little more about the bankruptcy option you mentioned. I have a leased car and own a home. Will I be able to keep this two things? And when will we be able to start rebuilding our debt?

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