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Pawned Jewelry to Make My Mortgage Payments And Can’t Keep Up With Payday Loan Payments. – Pete

Written by Consumer

Income: $116K + most years a 15% bonus

Home: Owe $300K and probably worth $280K, bought in 2009 for $315K with FHA 5% mortgage, $2750/month

Debt: $90K + $23K aginst my 401K

No savings except for $54K in my 401K

Total payments every month are greater than my take home pay and I have run out of savings. Trying to not go 30 days overdue on anything I started getting payday loans about a year ago. I now am 2 months late on the mortgage, 60 days late on many other payments, and have a couple of collection agencies after me.

My fiance could not find a job when we relocated 3 years ago but has gone back to school and will graduate next month. I do not have high hopes that she will find a job and be able to help any time soon. Mom has her house on the market and plans to move in when that happens.

She expects to give each of the kids $20K from the sale and plans to give $500/month to the house expenses. Bonus in December is not a sure thing but there is a good chance I will end up getting $10K after taxes. There is a good chance that I will also receive $25K in the next year from inheritance. I have a $5000 payday loan and need to make a payment of $950 today. I know it is totally crazy that I have gotten to this point.

We pawned some jewelry yesterday so I do have $1000 in cash but there are many other bils that have to be paid. I get paid next Friday and it will take my entire take home pay to pay the mortgage so that I do not go 3 months behind. I beleive that if I can get through the six months to a year that I can dig my way out of this situation but at the moment seem to have run out of options.

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I need to do something drastic this week. I am considering doing a hardship withdrawl from my 401K for the 2 months of mortgage I am behind. Until I saw your site I was planning to go see a CCCS. I’m also thinking about just telling the payday loan people that I can’t continue making payments and hope there is some other options that can be worked out. Is there something that I have not considered that would be a better option to get me through the next 6 months.

This is your chance to be a hero and help out this person by providing your feedback and answer to the question in the comments section below.

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This is information that was submitted by a third party and not generated by or Steve Rhode.

1 Comment

  • Hi Pete,

    With the detail you provided it does sound like you can turn things around given the 6 months time you suggested you would need. Some of the potential help you listed are could-be’s and may not come through, or come through in time to keep things going in a way that you need.

    I would encourage you to speak with a bankruptcy attorney about your options in a chapter 13 repayment plan. Your income suggests you would not likely qualify for a chapter 7. Talking with the attorney does not mean you are hiring and filing. You may learn that chapter 13 is a direction you can take to force creditors into a payment arrangement they would not otherwise agree to – and only in the event some of the things on the horizon that could help you do not come to fruition.

    Could you reply with a comment and break down the 90k debt by creditor/balance/interest rate?

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