Thank you for the information.
Your follow-up question: Would it wise for me, a 56 year old, recently widowed ~ to refinance my home to pay off the consequences of my husband's death? I owe about $90.000 currently consolidating $25,000, getting a little higher rate but reducing the years to pay off?
Response: No, it would not be wise to consolidate. It would not be wise to convert an unsecured debt to a secured debt using your home. It would not be wise to pay off this unsecured debt using your home basically as the collateral. It is NEVER a good idea to refinance for the sole purpose of consolidating credit card debts. You may however consider filing for Chapter 7 bankruptcy protection to wipe out the debt.
You would be eligible to file for Chapter 7 bankruptcy protection, if you meet the Means test—the income test. If your income is equal to or less than the current income guidelines for your family size in your state, you would be eligible to file for a Chapter 7 bankruptcy all things being equal. The income used in calculating the Means test is the income for the 6 months before the filing of the bankruptcy petition. This means that if you are filing for bankruptcy protection this month, June 2013, the income that would be used is your income from December 2012 to May 2013. If you are filing next month, July 2013, the income that would be used in the Means Test calculation would be the income from January 2013 to June 2013, etc. In Chapter 7, if the Court grants you a Discharge your debts will be wiped out with some exceptions such as some taxes, child support, alimony, which are not dischargeable. You would get a clean state, a fresh start.
These are current income guidelines for the State of Wyoming:
Family size of one person $45,336.00
Family size of two persons $63,193.00
Family size of three persons $73,688.00
Family size of four persons $78,733.00
Add $8,100.00 for additional individual
The filling fee for Chapter 7 is $306.00. You may able to waive this filing fee if your income is 150% below the current poverty guidelines. Click here for current poverty guidelines:
You must receive budget and credit counseling from an approved credit counseling agency and obtain a Certificate of Credit Counselling to be filed with his bankruptcy case. The agency will review possible options available to you in credit counseling and assist you in reviewing your budget. Different agencies provide the counseling in-person, by telephone, or over the Internet.
It is usually a good idea for you to meet with an attorney before you receive the required credit counseling. Unlike a credit counselor, who cannot give legal advice, an attorney can provide counseling on whether bankruptcy is the best option. If bankruptcy is not the right answer for you, a good attorney will offer a range of other suggestions. The attorney can also provide you with a list of approved credit counseling agencies, or you can check the website for the United States Trustee Program office at http://www.usdoj.gov/ust/eo/bapcpa/ccde/cc_approved.htm
After your case is filed, you must complete an approved course in personal finances. This course will take approximately two hours to complete. Your attorney can give you a list of organizations that provide approved courses, or you can check the website for the United States Trustee Program office at http://www.usdoj.gov/ust/eo/bapcpa/ccde/de_approved.htm
Consult a local bankruptcy attorney for further explanations of your rights and responsibilities.
The sites below are good resources for finding bankruptcy attorneys in your area:
If you cannot afford an attorney, then the next best alternative will be to use bankruptcy petition preparer. Bankruptcy petition preparers prepare bankruptcy forms but they cannot give you legal advice because they are not attorneys. Click on the links below for some of the bankruptcy petition preparers. You can do some searches on Google or Yahoo if you do not like the ones on the links below.