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LegalGround >> Bankruptcy questions


4/23/08 11:10 AM
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Cookie Monster
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Edited: Apr 23 2008 12:00A
Member Since: 3/3/03
Posts: 12121
 
I got a call from my sister in law last night and she is freaking out and finally breaking down, but doesn't know what to do. We always knew she and her husband (wife's brother) were having some financial difficulties, but nobody ever knew the extent, nor did anyone ever pry (as it is typically not anyone's business). Brother-in-law is a truck driver and works his ass off, but doesn't make a tremendous amount of money... wife works part-time. they have a comfortable house and the needs are met, but they don't have an extravagant lifestyle.

She informs me that they are severely struggling. He was between jobs for a period of time (quite a few months), so she paid everything with credit cards. Utilities, food, doctors bills, clothes... everything. This amassed a $50,000 credit card debt! Over the last four years they have paid some of that down and now owwe $42,000, however they are having to pay over $1000/month to make the minimums and that leaves next to nothing for them after bills are paid. All Credit acrds have been destroyed and there is no new credit. However, this is a slow and painful bleedout.

I don't know jack shit about debt settlement and/or bankruptcy, since I do criminal defense and personal injury work. What would be the best option under these circumstances.

Thanks in advance... CM
4/23/08 1:19 PM
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jbapk
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Edited: Apr 23 2008 12:00A
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Posts: 7066
Have they tried contacting the companies and and renegotiating their monthly payments?
4/23/08 2:29 PM
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Cookie Monster
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Edited: Apr 23 2008 12:00A
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no
4/25/08 8:20 AM
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Mike Yelsik
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Edited: Apr 25 2008 12:00A
Member Since: 1/1/01
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How many in the household? Bankruptcy is probably better than any attempts to deal with the credit card companies. They may have to file a chapter 13, but at least it will be over in 3-5 years. They will never pay that much down on their own. I do primarily Bankruptcy and Criminal Law in Michigan. So all my answers are based on how it goes here.
4/26/08 6:12 PM
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Fake Pie
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Edited: Apr 26 2008 12:00A
Member Since: 12/2/05
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They can get a bank loan and basically consolidate that debt into one lower interest rate (of course, I don't know in this market). O

r they can try and work it out with the companies. But Yelsik apparently knows this area so listen to him.

Something doesn't add up though. 50,000 could maybe be your expenses for a YEAR, not for a few months.
4/27/08 11:20 AM
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StephenL
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Edited: Apr 27 2008 12:00A
Member Since: 4/1/02
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now is the time to buy their stuff for real cheap. that's something that i wished bankruptcy courts did.

make the debtor do an inventory of all their stuff bought on credit, then sell it to pay off debt.

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