57K in credit card debt between my husband and myself. Most was from 40K in uninsured home repairs (mold that nearly destroyed our home), medical bills in excess of 3K, a BAD refinance decision ending in a mortgage we could not afford. The refinance resulted in us charging basics and cash advances to pay bills.
It took me about 9 months but I was able to get a mortgage modification at NO cost and we can finally afford our home. Now we need to deal with the credit card debt. Minimum due is about 1K for all cards but after ALL bills we only have about $450 left over each month. I know I owe this money and it’s my responsibility to pay it back but we just can’t. I looked into consolidation but they want a monthly payment of $1315. I just can’t do it.
What options do we have when we can’t afford minimum payments to creditors and we definitely can not afford debt management plan payments either. I feel bankruptcy is our only option by my spouse is very much against it.
Why is your husband against bankruptcy. It sounds like he has an emotional reason for harboring such strong feelings but what are they?
Being against bankruptcy in your situation is understandable but illogical. It’s like a hiker who has fallen and now dangling off a cliff saying that they are against any rescue rope that is yellow.
The reality of your situation is that you’ve managed to rescue the house with the modification but there simply is too little money left over each month to come anywhere near the minimum amount desired by the creditors.
So here is what is going to happen. Since your payments are going to be short you are going to wind up in collections, you may eventually be sued by one or more creditors and after six months, those that did not sue you, will most likely sell your debt to another company and the process will continue.
What we have here is an unsustainable financial situation that is only going to alter its course with the application of some intervention. The only intervention that you can employ that gives you legal protection and adjusts the debt to a level you can either manage or wipe it out, is bankruptcy.
I can’t wait to hear what his objections are to bankruptcy.
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