$8,000 in debt to Barclays Bank. All debt was accrued during a manic episode. I have been making $257/ month payment to National Debt Relief.
I lost my job and had to use retirement $ to live on until I found a much lower paying job. Agreement setup with IRS for $250 per month associated with taxes not paid during unemployment & 401k early withdrawal penalties.
Barclays issued a summons. They are demanding payment of all the debt over 11 months. I cannot afford $450/ month payment and the $250/month payment to the IRS. Very stressed out.
Is there any legal precedent for debt relief due to bi-pilar manic episode? Please help…
How can I get help? I have a letter from my psychiatrist.
Financial problems as a result of bipolar disorder are not uncommon in my experience.
You are absolutely correct that the manic phase of the disease can leave you feeling overly optimistic and can lead you to take impulsive action and make poor decisions. This can lead to overindebtedness.
Give the fact you owe on some consumer debt, back taxes, and have had to raid your retirement accounts I can’t help but wonder if bankruptcy might not be a better option worth exploring.
In a Chapter 7 bankruptcy, your debt may be able to be discharged in about 90 days. This would let you get back to doing better moving forward instead of trying to repair the past mistakes.
The one area where mental health issues can help with debt is with federal student loans and a disability discharge. Outside of that, I’ve never heard of any court accepting that the usual flavor of bipolar disorder is a reason to eliminate debt.
I suppose the argument that would have to be successfully made is that you were not of sound mind when you applied for the credit you subsequently used. That sure seems like a tough hurdle to jump and it could wind up costing you a significant amount of legal fees to try and fight that.
The logical plan of action is to make sure you are under treatment for your bipolar issues, they are under control, and then to eliminate the debt so you can get a fresh start instead of spending years digging yourself out at the expense of a safer future.