My wife and I have a combined debt of 75,000.00. A large part of this is due to using credit cards when I was out of work for a year and a half. This was 4 yrs ago.
We are current on all of our debt but find that we are just getting by paycheck to paycheck. We inquired about bankruptcy and since we make too much we would be subject to filing chapter 13 and the means test showed that we would be paying about 300.00 less per month vs. our current minimums if we filed.
We do not feel that this is worth destroying our credit over and have read some of Dave Ramsey’s site regarding avoiding bankruptcy if possible. We have a house which we will be selling in order to move closer to family and just be lucky enough to break even with the amount owed on our mortgage.
We’ll be renting for the foreseeable future. We would like to pay our debt off and begin to save for a down payment for another house in 5-7 yrs. We looked into debt settlement with Clear One and debt management with ACCC. ACCC (consumercredit.com) seems to be the more viable route as it would be a negative mark on our credit but seems to be more recoverable than a debt settlement company.
Can you please give some insight as to how we can tackle our debt of 75,000.00 with bankruptcy being a last alternative. Is ACCC(consumercredit.com) a good way to go? Their plan would have us out of debt in 57 months. Clear One Advantage says we could be done in 30 months but I’ve read that creditors can and will sue you while they’re waiting for settlement. Also, I’m not comfortable with discharges being on my credit report as I feel this will make it more difficult to rebuild our credit.
Our goal is to eliminate our debt and rebuild our credit in 5-7 yrs so we may qualify for a mortgage at that time. Is ACCC the way to go or can you provide any other alternatives?
I’m so glad you contacted me for advice before leaping.
I’m concerned that Clear One Advantage and ACCC might not have done a good job about educating you about all of your options because you still have some gross misperceptions.
The bottom line is the debt solution that is best for you is going to meet your goals and current situation.
I’m concerned that your debt load or any payment plan is going to prevent you for getting to saving for retirement as quickly as possible. See this online calculator.
If either Clear One Advantage or ACCC had evaluated your situation completely they would have told you to get a second opinion from another bankruptcy attorney about qualifying for a chapter 7 bankruptcy.
They would have told you that a chapter 7 bankruptcy eliminates your debt in about 90 days and is far less expensive than the other approaches. They also would have told you your credit would be rebuilt faster than with either of their plans, if you filed bankruptcy.
I’m afraid that instead they fell into their “avoid bankruptcy” sales script and feed you lines about why their approaches were better.
And when you dig a little deeper, you’ll find Dave Ramsey isn’t so honest about bankruptcy as well.
I don’t want to come across as everyone is wrong and I’m right. What I do want to do is educate you that most of what you are hearing is just bullshit so everyone can sell their widget.
No solution should be the last or first alternative when starting your approach to get out of debt.
I’d suggest you first read How to Get Out of Debt. The Honest and Unvarnished Truth, How Do I Get Out of Debt Quickly? Change Your Mindset, and The Truth About The Success Rates, Failure Rates and Completion Rates of Credit Counseling, Debt Settlement, and Bankruptcy. They will give you a great overview of what we need to deal with to get you moving in the right direction.
Then use the free How to Get Out of Debt Calculator to review your options.
Once you’ve identified a company you want to work with, then follow my step-by-step guide on what you should look for and expect from a good debt relief company.
Bankruptcy Articles and Posts You Must Read
To get ready to read the information below with the right frame of mind, please first read How Do I Get Out of Debt Quickly? Change Your Mindset.
- Those That File Bankruptcy Do Better Than Those That Don’t
- How to Know if You Should File Bankruptcy
- So You Are Going to File Bankruptcy. That’s Great News. Congratulations.
- Easily Rebuild Your Credit After Bankruptcy
- The Truth About Bankruptcy Success Rates
- How to Get Out of Debt Calculator
- How Avoiding Bankruptcy Can Backfire
- How Long After Bankruptcy Can I Buy a House?
- Is Bankruptcy Sinful and Bad or Right and Moral? An Examination
- What Does the Bible Say About Bankruptcy? Is Bankruptcy Scriptural?
- How to Get Out of Debt. The Honest and Unvarnished Truth
- The Emotional Seven Stages of Debt
- Getting a Job After Bankruptcy
- Chapter 7 Bankruptcy – What is the Truth?
- Low Cost / Pro Bono Bankruptcy Resource Locator
- Bankruptcy Should Be the Last Resort Many Say. But That’s Just Not True
- The Ethical Considerations of Bankruptcy
- Is Bankruptcy Right For Me?
- 14 Reasons You Should Not Avoid Bankruptcy
- How to Really Discharge Your Student Loans in Bankruptcy. Many Can. But Never Try.
- Life After Bankruptcy: How to Quickly Have Great Credit and Dumb Mistakes to Avoid
- How to Find a Great Bankruptcy Attorney
- You Have Not Failed if You File Bankruptcy
- The Saddest Avoidable Mistake People Make When Getting Out of Debt
Life After Bankruptcy
- How Long After Bankruptcy Can I Buy a House?
- How to Rent a Lovely Home or Apartment After Bankruptcy
- Life After Bankruptcy – The Truth
- How to Easily Rebuild Your Credit and Have Good Credit Again After Bankruptcy
Filing Bankruptcy Yourself
Please post your responses and follow-up messages to me on this in the comments section below.