My wife and I are 81K in unsecured debt and 5K in back taxes. All the unsecured debt is now reflected as judgements. We are now both facing garnishments. We are both working and have a yearly combined gross income of about 110K. We own a home and are paying off two cars. Four years ago I lost my job and was out of work for 9 months. Right before I lost my job we were working with a credit counseling service who basically did nothing except collect our money. We dropped them shortly after I lost my job.
I have consulted a lawyer about bankruptcy. We would have to file Chapter 13 and have to pay 1200 a month with the payment plan. This is unsustainable.
What are my options?
I would like to cash in my 401K and Whole Life Insurance but would only have about 42K in cash to settle the debt.
Any help would be appreciated.
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It would seem that a bankruptcy approach would be the most logical since it would terminate the judgments. Why is the $1,200 monthly payment not sustainable? Were you willing to make other changes to your underlying financial obligations?
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