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I'm another one of the success stories of consumer credit counseling. My husband and I dug ourselves into debt and we dug ourselves out! It took 5 years of making those monthly payments but we did it. We did without a lot of excess during those years and were paying for daycare on top of everything else, but we did it! My score is 775 and his is 725 now. We are in the process of selling our house to buy a new one and we owe very little. It sucks that we lose control sometimes but if you want to pay it back, you can. Bankruptcy is a word that has always scared the crap out of me. If you can find any way to pay it back before you do something that drastic I would. It's so much better in the long run if you dig your heels in and accept that you messed up and find you own way out. Good luck to you!
I actually work for a credit counseling agency. Some of them are actually legit as some of the posters have testified. The original poster failed to mention some important information in order for us to offer the appropriate advice. Is he married? Does he have to take care of a family? How old is he? What other debts? If this person is a single guy 23 yrs old, for example, then i'd tell him to get a 2nd job and pay down that debt asap. A debt mgmt plan thru consumer credit counseling service would lower the interest rates to a manageable level to help bring down the balances faster. If this person has the ability to move in with a roommate or with a relative for one year, he or she could pay off the debt fairly quickly. Now on the other hand, if there is a mortgage, kids, etc..then of course that $20K starts to appear like a bigger problem. Bankruptcy for $20K doesn't seem worth it to me if there is any way to avoid it. Plus, you can't automatically qualify for a Chapter 7 bankruptcy. Many people are forced to repay back their debts so i say, unless there is a wage garnishment on the horizon, try a debt mgmt plan or 2nd job to work it out.
P.S. I just wanted to add, for many years now bankruptcy was not such a big deal. Creditors were more than willing to keep extending credit as soon as a bankruptcy was discharged, but now with the mortgage mess and so many people defaulting on ALL of their debt obligations, i personally feel that in the future, having a bankruptcy on your credit report will be more of a problem than it used to be. To everyone (including myself) get out of debt as soon as you can and live debt free!! Real Debt Help - Get out of debt with Dave Ramsey's Total Money Makeover Plan.
I'm another one of the success stories of consumer credit counseling. My husband and I dug ourselves into debt and we dug ourselves out! It took 5 years of making those monthly payments but we did it. We did without a lot of excess during those years and were paying for daycare on top of everything else, but we did it! My score is 775 and his is 725 now. We are in the process of selling our house to buy a new one and we owe very little. It sucks that we lose control sometimes but if you want to pay it back, you can. Bankruptcy is a word that has always scared the crap out of me. If you can find any way to pay it back before you do something that drastic I would. It's so much better in the long run if you dig your heels in and accept that you messed up and find you own way out. Good luck to you!
Nice job! Its always good to hear a story like this. I hear so many people who think that it is just fine to buy everything they want and then walk away from their obligations. It's nice to know that there are still some ethical people around. Reps for you!
My post said "up to" 10 years which would mean the same thing as the max.
I would be interested to hear how filing for bankruptcy will not impact your ability to get a mortgage in the future. That is a standard question on mortgage applications.
Due to a burn and crash for a business DH and I had, we filed for bankruptcy about 20 years ago. We have had three mortgages and numerous refinancings approved since then. I have never seen the question "have you EVER filed for bankruptcy" on any of the applications.
Apparantly more than one person got dinged on this topic for responding as I did, based on a few responses I got via PM's. I invite anyone else that got a negative ding from this topic to send a note to the admin's and get the person a ticket to 'banned camp'!
That's not directed to you pghquest (unless you were the negative reper, which I very much doubt because you seem to have answered repectfully and logically). I invite debate and appreciate counter arguments.
Yes I agree with the legal issue to an extent - when I say "legal" i mean that the lender has legal remedies in place, not imprisonment of course, but garnishments, etc. It's a legal matter indeed.
But I have to disagree with the impact of a person not paying back the loan. It's called the trickle-down effect. When someone does not pay, someone else pays. On an individual basis a company can assume the loss, but on a collective basis where 9.8% of the population (as an example) decide to default on loans we all pay, a company has to pass on their costs or go out of business - interest rates go up, service fees to their other lendors go up, credit card company outsources jobs to cut costs, etc. You don't have to be using the same bank remember, this is macro-economics. The users of this bank, big and small companies, faced with increased costs, must then raise their charges. It may be your local hair stylist or laundry. Again, they raise there charges to the consumer (you and I), maybe lay-off some people, etc. It all trickles down.
So one person defaulting on $20k does not make an impact, but 100,000 people defaulting on $20k has a $2 billion dollar impact on the economy. And that's why we have our recession risks today. Yes, when I see this post I see one thing - the OP asking you and I to pay for his $20k default.
I guess I am risking a "negative ding" but I have to say that I completely agree with you. There is absolutely a trickle-down effect due to people walking away from their obligations. If someone buys a big screen TV even though they don't have a pot to p**s in, and then they don't pay their credit card bill ... no, the credit card company doesn't then bill you and me for it directly... but the increase in rates affects everybody, and the increase is due to the higher cost of doing business because there are too many deadbeats and parasites out there.
On another subject, I have only hit the + sign to give rep points to well-thought out comments. I didn't know you could give or get negative rep points. Where is that? I would like to go and count all of my negatives to see if I am doing a good job getting on people's nerves for relentlessly preaching personal responsibility and accountability.
If someone else is being hurt by that debt not being paid, why ISN'T it immoral?
I know, right? Last time I checked, when you can't or don't want to pay for an item but you get it anyway, it's stealing. I thought stealing was immoral?
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