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I’ve Been Laid Off Three Times in Three Years. The Bills Are Too Much. – Deb

“Dear Steve,

I am 3 times laid off in 3 years. I only have unemployment insurance coming in to support me and this may run out soon. I have no assets at all. I have lost everything in the last 3 years of lay-offs. I rent and own nothing else of value with no savings and am having difficulty finding a job to even apply to in my profession to the extent that I am considering starting my own home based business in order to get some money coming in.

I cannot afford even the $100 month payment that the collection attorney is asking for in court (yes, they have filed suit against me and a second one did so last week for a total debt owed of $7,500 on 2 credit cards) I offered to pay them (pre-trial) a lesser amount on the debt and a smaller payment with lower interest, but they refused. I am not trying to avoid my debts, bu t I am struggling to stay afloat and my car payment is a priority in that if I do not have a car I cannot find a job, do a business, or get to a job.

I am juggling paying everything weekly between the rent, utilities, gas, car payment, food, etc. I cannot declare ch. 7 as I did so in 2005 after my first lay-off. I often feel trapped and hopeless about any future job-wise or financially. One attorney I consulted for free advised me to pay nothing, close my bank account, and file ch. 11 if I ever become employed again. I am in Ohio and unemployed 10 months now. Thank you.

Should I agree to a payment plan with a collection attorney at 23.9% interest on an inflated credit card balance through the court or am I judgment proof for now? If I do start a small business can they seize my business assets through this judgement if it goes through?


Dear Deb,

Well I don’t know about being judgment proof, they can go for a judgment but trying to collect on it is another matter.

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I do have some strong reservations about you entering any repayment promise at this time. Honestly, as dynamic as your current situation is you can’t really afford to make a promise to pay that has no likelihood of success based only on unemployment benefits.

I’d just back burner the collection efforts at this point and not deal with them right now. The primary focus needs to be on getting a job and bringing income back in. Once you can do that then we can go back and worry about making payment arrangements or a latter bankruptcy.

So to wrap it up, it sounds like the best thing to do right now is, nothing.

I’m also worried about the small business route. Even in the best of times it is hard for a business to survive and make it. On top of that you have your current emotional desperation to make money to care for yourself. For most people the combination of underlying issues would make it darn impossible to build a successful business at this time.

However, if your own small business would allow you to start and grow your business without an investment in money and you continued you search for a job while you were developing your business then it could be a good distraction for you and provide you with an opportunity for new income.

Please update me on your progress by posting updates here in the comments section of your question. I’m very interested in how this works out for you.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

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About the author

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.


  • Hi Deb,
    Your story broke my heart as I too was in the same situation you were. I realize you were wrote your last post about 9 months ago and I would like to see how you are doing. Hopefully you landed a job and are in good standing as your debts are concerned.

    All the Bst,


  • Well, I went to court and told the judge and Capital One’s attorney that I could not pay anything as I have nothing but unemployment. They were very understanding and the case was ended, not “going to trial”.

    The attorney afterward told me that they would probably not put a hold on my bank account if all that was going into it was an unemployment check. He said that I should expect a call in the next year from them to see if my situation had changed, i.e., I have an income or win the lottery. Ha!

    Now I am facing a similar meeting in court with a second creditor, but I am no longer afraid nor ashamed.

    Steve, thank you for helping me face these very scarey events and get a perspective. It is a tremendous load off my mind and heart.

    Your website is a God-send and I will try to “give back” by being supportive of others when and if I can.

    • Deb,

      The comments you have been posting on disability issues have been a blessing.

      It’s nice to know you’ve broken free of the fear and can now see it is just a process. I’m so glad I was able to help you.

      Big hug.


  • Steve-
    Thank you for your helpful insights. You have confirmed what I had been feeling inside regarding setting up a payment arrangement. It is just too much for me to handle at this time. I go back to court in December and I am going to state in writing to the judge and collection attorney that I cannot pay anything at this time due to insufficient income and an uncertain future regarding unemployment benefits. I WILL appear, of course.

    As for the home based business, I am exploring some ways to generate income with no start up funds. There are a few ideas that I am considering, but they probably won’t bring in much or might take a while to get off the ground. However, something is better than nothing. Like you implied, doing this gives me something to hope for while I am also sending resumes out into what feels like The Twilight Zone.

    Thank you for your time. Your response to my concerns has boosted my hope factor and confirmed my gut instincts. I will keep you posted on my progress in this matter.

    • Hi Deb,
      Your story broke my heart as I too was in the same situation you were. I realize you were wrote your last post about 9 months ago and I would like to see how you are doing. Hopefully you landed a job and are in good standing as your debts are concerned.

      All the Bst,


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