Bankruptcy Law Questions? Ask a Bankruptcy Lawyer.
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I absolutely recommend you consider a chapter 7 bankruptcy. Anytime a debtor has $100,000 in credit cards with a sudden drop in income a chapter 7 bankruptcy should be considered. It may be difficult for you to qualify while you're receiving 100% of income through disability but you still may be able to. There is something called the chapter 7 means test. It takes into consideration your geographic area and household size income you are allowed to earn for the first part of a three-part test. One person is approximately $42,000 and for each additional individual added it's approximately another $9,000. If you are over the income limit then court will deduct your secured debt payments such as mortgage payments or car loans from your income to then see if you qualify. If you don't qualify right now you definitely will qualify as soon as your income is reduced to the 60% level.
Bankruptcy was made for honest but I was fortunate debtors facing hardships like yours. I truly hope you don't feel guilty utilizing legal options that exist. If the bankruptcy is done properly you should also be able to retain your home and vehicle.
I hope that this information is helpful and I wish you the best of luck going forward.
Private disability income will count on the means test. Monies that come in through the Social Security Act such as SSD would not count. Quint additional facts you would not meet the first part of the means test as your income will be over 43,000. However the second part of the means test allows you deduct secured debt payments so that's your mortgage or car payment 2 then see if you qualify. So the question is if you deduct your annual mortgage and car payments from your 57000 will that bring your income down to or below 43000. It probably will and you should qualify for a chapter 7. If I still have not answered your question please ask for further clarification. Thanks.