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socrateaser, Attorney
Category: Bankruptcy Law
Satisfied Customers: 38507
Experience:  Attorney and Real Estate Broker -- Retired (mostly)
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I have about $100K in credit card debt, with no assetts except

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I have about $100K in credit card debt, with no assetts except a used car worth about $7K, an underwater rental property which is worth $140K with a $143K mortgage on it, and about $40K in a tax-deferred retirement account. I work for the federal government and earn about $165K per year. I also receive a state government pension of about $40K per year. I'm 65 and will not start collecting social security until 2014. Is there any way that I can file Chapter 7 bankruptcy to discharge the $100K in credit card debt, or does my income level prevent this? I don't see much advantage to filing for a wage earner plan under Chapter 13 since that will trash my credit for very little gain. Any other way to escape this debt?

You appear to have partially analyzed your circumstances correctly. There is no way that you can file Chapter 7. As for Chapter 13 trashing your credit, the real issue is whether or not you believe it would be better to resolve your debt problems before you retire, or afterwards. Ultimately, if you are retired, and your income comes only from a federal pension, you could simply tell your creditors to go jump in a lake, because they would not be able to collect against you. But, that would ruin your credit, too.

In my opinion, if you think that having good credit after age 65 is a good idea, and you want to get rid of your current debt, then a Chapter 13 may be a good plan. Otherwise, you can do nothing and still avoid having to pay the debts, based upon your retirement income being unreachable by your creditors.

Hope this helps.
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