Ask The Get Out of Debt Experts Unemployed

I’ve Been Unemployed and Now Can’t Afford My Minimum Payments. – Marco

“Dear Steve,

I have been unemployed since Jan 5th 2009. My UEI covers my hard bills, rent , car loan, car ins, untilities, a little food. I have used my savings to pay my credit bills thinking I would find a job. I have run out of my savings and have made poor mistakes that way I beleive. I have now gotten rid of luxury items such as cable and live of a very small food budget of basically rice and bean, no joke… and can afford to pay three of my card minimums that way

So my question is… out of the 6 cards I have I can afford to pay the minimum on three but the others I want to close and set up a payment shedule to pay the balance. I believe if the minimum was cut in half I could afford it but if not then I will suffer late fees.
1. Will the card companies simply send it to collections and I will hve to set up payment that way or will they sell the debt and I pay that way.
2. If Im paying a collector timley and have not defaulted but set it up does that show on my credit negatively


Dear Marco,

Unemployment is not designed to help you pay your bills. It is designed to help you get by while you look for another job. Unemployment benefits will expire at some point as well.

Paying your credit card bills from your savings would be a mistake. Without any new job and replacement income before you know it the savings will be drained and the debt will still exist.

If you have credit cards that have already been sent to collections, your credit is already shot. At this point, without any job on the horizon you are better off talking to a bankruptcy attorney and to stop paying the collection company or creditors. Click here to find a local bankruptcy attorney to talk to for free.

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I know you want to do the right thing but the path you are on isn’t it.


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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.


  • Wow, I hadn’t thought that maybe it was an urban myth. I did get my credit checked when I got a recent part-time job, but I figured whatever they were looking for I passed. Of course, they also wanted numerous other checks. It must cost employers a pretty penny to have to do all those checks on people before they hire them.
    .-= Spiritwealth´s last blog ..Spring is here, time to plant… =-.

  • Steve,

    I’ve been reading articles on people being denied jobs based on their poor credit. If he hasn’t blown his credit yet, and files for bankruptcy, won’t that automatically ruin his credit? What chances then will he have of finding a job? How does filing for bankruptcy show up on a credit file?
    .-= Spiritwealth´s last blog ..Spring is here, time to plant… =-.

    • Spiritwealth,

      Most of the stuff you might see online about not being able to get a job based on bankruptcy is an urban myth. These days you can even get a security clearance with bankruptcy. The number of actual jobs that are blocked from having bankruptcy is tiny and would also be blocked by having money problems anyway.

      I can’t even remember the last time I helped someone that could not get a job after bankruptcy because of the bankruptcy.

      The bankruptcy will appear in the public records section and accounts included will be noted as being included in bankruptcy.

      My experience is that those these days that try to scare people away from bankruptcy with the job fear statements are typically using it to sell whatever debt solution widget they are trying to promote.


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