Bob Is Underwater And Drowning, In Debt

“Dear Steve,

Can I ask for your advice since I’m so overwhelmed with debt. I have 4 credit cards with approximately $48,000 in balance. I’m only paying the minimum amount due per month because that’s all I can afford considering the other expenses I need to pay (mortgage, car loan bills, etc).

Most of the debt here were house related since we were expecting to have our house refinanced after several months and payoff some if not all our credit card debts. But we are underwater so refinancing is not possible. The I stumbled upon your website. I’m the only one working since my wife takes care of our baby.

What can I do? Please help.


Dear Bob,

You are drowning in debt and the only fundamental ways to change the balance of debt problems is to lower obligations, increase income, or a combination of both. Or think about it this way, lower the water level or increase your height above the water line.

The technical way to get out of debt is easy, spend less than you earn. But when your income is completely spoken for and obligated, even before you bring it home, that’s a problem.

The liability of debt is that in order to repay it you must work and earn in the future to meet that obligation. Currently all of your future labor has been pledged to meet those past obligations. The only way around that would be for you to get a raise, to get a second job, for your wife to go back to work and earn more than the cost of daycare for your baby, or to look at reducing or eliminating your debts.

The two most mainstream approaches available to you would be to look into a debt management program and see if your credit card payments could be lowered in a debt managment program (click here), or bankruptcy (click here).

Bankruptcy would allow you to get out from underneath your underwater house and discharge your credit card debt to allow you to start over. But before you do anything, I would encourage you to speak to a local bankruptcy attorney and ask for a free bankruptcy review and to speak to a debt management program provider.

Only once you are armed with the facts of how those solutions will assist you can you make the best decision about which option is best for you.

My gut tells me that once you evaluate both a debt management plan and bankruptcy, that bankrupty will make more sense.


You are not alone. I'm here to help. There is no need to suffer in silence. We can get through this. Tomorrow can be better than today. Don't give up.
Steve Rhode
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