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Why Does My Husband Have to File a Chapter 13 Bankruptcy? – Jill


“Dear Steve,

Husband has gotten soooo far into debt with his charge cards. Went to a bankruptcy lawyer and our only option is Chapter 13, for 5 years. I am not involved in it as I am not joint or nor do I own anything. We are not late on anything or behind on anything. He just owns too much credit card debt, about $60,000. He will have to pay back almost 100% because he makes good money. I went onto CNN Money and they actually show you how to pay of your debt 2 different ways. One by paying a certain amount every month and one by how long you want it to take to pay off the cards.
We simply put in the amount that the Chapter 13 would make him pay monthly and by not bankrupting, it shows it will only take 5 years and 4 months. ONLY 4 MORE MONTHS THAN BANKRUPTCY! It shows step by step how to pay each charge card off, starting by paying the highest interest rate off first, then the next ect. It’s very do-able since it’s the same thing that CHapter 13 would make him do. All this is based on the credit rates not going up. Now his 2 American Express cards are changing the FIXED interest rate to a VARIABLE rate and this has thrown the CNN money step by step plan out the door. He called Amex and explained that he has stopped using them a year ago and that he was at the limit he could pay back and could they please try and work with him so he could pay it off. He was only asking them to keep his rate where it’s at. HA! is about what they said, even after he told them he had contacted a bankruptcy lawyer.

Do you think he should try and keep paying his debt down with CNN’s step by step help, each month changing the variable interst rate on the 2 Amex cards or just say bump it and do Chapt. 13 and get out from under the stress? He has a high profile job and I am sure that an employee would see his name in the paper, report back to work and it could possibly make management feel that if he can’t handle his finances how can he handle more responsibility. Thanks for your opinion

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Dear Jill,

American Express is going to do what American Express wants to do. They are still free to jack his rate way up to a point where it will take him years and years to repay. You can make a logical case all you want but that is not going to prevent them from potentially reaching a determination that your husband is trapped in a difficult position and they know they can raise his rate up to maximize their revenue.

The fearful statements about him filing bankruptcy are really non-issues for the most part. I seriously doubt your local paper is going to print names and there are few positions these days where it actually make a difference. It is less likely to hurt a security clearance than maintaining excessive debt does.

You mentioned a very important point, stress. If his debt is impacting the quality of his life then it is already negatively hurting his work performance and health. Leaving him in that situation does help either.

Here are two alternate options.

  1. Adopt the debt snowball debt reduction approach and you help him do this so he has to be accountable to someone and stay on track.
  2. Look at the option and look into a debt consolidation loan to pay off the debt at a lower fixed rate.

Ultimately, nobody has to file bankruptcy, but then again if they didn’t want to use hot pads or oven mitts to remove stuff from the oven they don’t have to do that either. Bankruptcy for most is a matter of choice but is the most protective solution available.

If you still remain unconvinced about his options, why don’t you schedule an appointment with the bankruptcy attorney so you can both go in and get all your questions answered. What can that hurt?

Update me in the comments section of this question on what you elect to do.

P.S. Be sure to read ‘The Secret of Surviving Through Difficult Economic Times. What I Learned On My Journey‘.

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.


  • WOW! What a great guy you are for your help, not charging for it and letting us pick your brain. You even gave me the correct terminology on “debt snowball.” You hit the nail on the head because the stress is killing him and so is the indecision. SOOO happy I found your site. Thanks so much again for helping!!!! Jill and hugs right back:)

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