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Our Monthly Income Has Dropped From 10K to 3K, Now What? – Maria

“Dear Steve,

I have over 30k in card debt 2 mortgages 200 k and 70k with a balloon mortgage due in 04/10 on the 70 k our per month income has dropped from 10k to 3k

Now what? help!!!!!!!!!!!!!!!!!!

Maria”

Dear Maria,

With a big drop in income I can’t imagine how you would be able to make ends meet, qualify for your replacement mortgage, and continue to service your credit card debt.

Difficult times call for difficult choices and unless you can find some way to replace the lost income you will be faced with no other choice than to adjust your lifestyle to fit within your current income. If you have commitments, like mortgage or rent based upon your old income, you are probably going to have to move.

It would be highly unusual to find someone with a extra 7K of money floating around doing nothing so there is no doubt in my mind that the lost income is creating a real hardship and that the type of changes you are going to have to make will be deep and painful. I’m sorry.

You have two choices. You can proactively look for a new and affordable place to live, move and then file bankruptcy on the debt you can no longer service. Or, you can wait until you are so far behind that you will be forced to move through foreclosure or eviction, with collectors chasing you every step of the way.

I’m sorry I can’t paint a rosy picture for you here but your situation is near impossible to overcome with a 100% replacement of the missing income. You see, lifestyle tends to expand to fill the available income and when that income suddenly goes away, it is almost never a happy and easy transition.

Sincerly,
Steve

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.

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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.

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