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legalgems
legalgems, Lawyer
Category: Legal
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Experience:  Just Answer consultant at Self employed
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I have too much credit card debt. I have been paying on

Customer Question

I have too much credit card debt. I have been paying on these for years but I still owe ~31,000, that is realistically not manageable. Last year I had total hip replacement. I work contract and was not paid during that 6 month time period. I sold a home just to be able to pay my deductible and then lived on the balance until I could work. I am 64 and need to pay off my CC. I have not been delinquent on my house payments or any other debts. But I am not getting anywhere financially. No I do not have a 401K
Submitted: 7 months ago.
Category: Legal
Expert:  legalgems replied 7 months ago.

Are you trying to determine if you qualify for bankruptcy?

Customer: replied 7 months ago.
No I do not want to proceed in that or chapter 11 if I have an alternative. i am also working again
Expert:  legalgems replied 7 months ago.

So are you looking into debt negotiation and want information on that?

Customer: replied 7 months ago.
I suppose , I am looking for some kind of program that will allow for quicker payoffs at a reduced and combine all my debt.
Expert:  legalgems replied 7 months ago.

OK, that is debt consolidation. One needs to exercise caution as some of these companies are not very honest. Debt consolidation usually requires some kind of collateral (ie a residence). In addition to interest, you may have to pay "points," with one point equal to one percent of the amount you borrow. Failure to pay can result in losing the collateral.

One can also hire a debt negotiation company but first one may wish to negotiate directly with the creditors so as to avoid the company's fees. Basically one would work out a payment plan, and request that some of the principal, and the interest and late charges, be waived. The policy of the individual creditor will determine what they are willing to accept.

Information on debt settlement companies are here:

https://www.consumer.ftc.gov/articles/0145-settling-credit-card-debt

But the idea of bankruptcy is to give one a fresh start, so if one qualifies for bankruptcy that should be considered as an option.

Chapter 7 is known as the fresh start alternative; that information is here:

http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-7-bankruptcy-basics

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Expert:  legalgems replied 7 months ago.

While researching a similar issue I came across some more information you may find useful:

http://www.consumerfinance.gov/askcfpb/1459/should-i-use-debt-settlement-service-help-me-deal-my-debt-and-debt-collectors.html

Please keep in mind that any forgiven debt is taxable as income to the consumer, because the creditor writes it off as a loss.

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No attorney client relationship is created as this is general legal information, not advice; and a personal attorney should be hired if one wishes specific legal advice for their personal situation.

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