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Single Mother, Struggling, Depressed, Anxious, Can’t Sleep. – Veronica

“Dear Steve,

(struggling) small business owner and single mother. I owe approx 70K in credit cards & credit lines. Tapped out of credit options. In addition, I’m scared, cant sleep, anxiety, etc.

I am about to close on 2nd mortgage in order to pay off debts. As an individual, can i negotiate with banks, credit card companies to reduce pay off amount? Or do i have to be represented by 3rd party


Dear Veronica,


Hopefully I’ve caught you in time. I don’t think the second mortgage is a smart move, AT ALL.

You would be much better entering into a Chapter 13 bankruptcy to dig yourself out. This would protect your home, not result in more of an obligation against the home, stop all collections calls and activity, and allow you to repay the debts based on what you can afford.

I fear the second mortgage decision might have been based on the knee jerk reaction that a loan is always a better way to deal with debt.

I sure hope I’ve caught you in time. Before you take one more step towards closing that second mortgage, I urge you, I beg you, to find a local bankruptcy attorney you like and first go in and discuss what bankruptcy would mean for you and the protections it would give you.

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.

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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.

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