Intro and debt trouble question (m)

iVillage Member
Registered: 03-27-2003
Intro and debt trouble question (m)
3
Mon, 05-19-2003 - 11:28am
I'm Julie. I post to other parenting boards, but I should spend my time here due to all of our troubles these days. I work out of the home and DH is home w/ our boys (3 and 8 mos) b/c daycare is so expensive. He works PT two nights per week. No one else will hire him b/c he is not available on weekends (he works on the weekend during the night and sleeps during the day).

So here we are...getting caught up on our mortgage and trying to get caught up on car loans (a month behind on everything). We will rectify the mortgage this month b/c we are taking full advantage of the extra paycheck.

We were on CCCS, but the payment was just too high (we were classified as a two FT income family). I called and asked about reassessing us and adjusting our payment and was told that we should just file CH. 7. Didn't want to do that...but at the same time...once CCCS stopped the draft to pay on our accounts...we weren't paying either b/c we just haven't had the money. I'm trying to scramble to pay the secure debt and our utilities.

We were told by CCCS (a new rep) that they would close out our account and we should then reapply with our current income. But we haven't done that b/c it requires a payment and I want to get our secured debt on track first.

So...we got a note from a law firm (a shock to us) for one of our credit cards. They want to settle the account. We cannot settle on a lump sum. I guess we could arrange a payment plan or a settlement amount and then pay monthly on that? Anyone know how this goes or what we should expect? I was thinking automatically that this forces us to file Ch. 7.

Thanks for listening and offering any knowledge on this that you might have. We were hoping to reapply to CCCS in July. We are already 3-4 mos in arrears on our credit cards.

Julie

Avatar for cl_beckymk
iVillage Member
Registered: 03-19-2003
Mon, 05-19-2003 - 11:41am
Hugs!!! Sounds like things have been rather tough recently for you. I don't think anything can *force* you to file any bankruptcy. I don't have any good advice on this subject for you as I have never been with CCCS before, so I don't know all the ins & outs of that.

I did want to let you know that we also have a Debt Question & Answer board that could help you more with the specific questions, just copy & paste your message as a new post over there. http://messageboards.ivillage.com/iv-mldebtqa

You can do this!! Slowly but surely, there are ways just takes a lot of patience and slow progress. Have you tracked all your income, etc...? Sounds to me like you have more outflow than income at the moment? Which is what is putting you in the red every month? If that's the case, then you need to see where you can cut back, sell stuff (garage sale, e-bay, etc...) or figure out how to get more income. We do have a Tracking board to help you in this area too http://messageboards.ivillage.com/iv-mljournal

And please continue to post here for emotional support as you work your way out of debt! We have people on all parts of the spectrum of debt here, from just starting out to seeing the light at the end of the tunnel and we are all here to lend an ear (and sometimes a *small* bit of tough love at times but only because we've BTDT).

Becky

iVillage Member
Registered: 03-27-2003
Mon, 05-19-2003 - 12:23pm
I'm sorry to hear about your difficult situation. Most of us have been there or close to it, so this is a great place to get support.

I don't have specific advice for your situation, but I do want to encourage you to get a really good understanding of your full financial picture before you take any further action. This means, as someone has already said, tracking your spending, and several other things. Take a notebook with you everywhere, and write down every cent you spend--snack machine, coke at the gas station, groceries, bus fare, *everything*. Also pay attention to how often you get in your car and drive. Do some mental calcualtions--how much are you paying for gasoline per mile, and then how many miles for each of your regular trips, for instance. How much are you paying for breakfast cereal when your kids might like a sliced banana and bread with jelly better anyway? And so on.

You will be surprised how many places your money is leaking out (we sure were!!). Then you need to find out what your real inflow of money is. This means weekly paychecks, money from your business (by the way, as you're tracking your spending, you need to figure out how much you're spending on business expenses too--paper, pens, ink cartridges, postage, etc.), and any other income. You might find it easiest to look at your income over the past year and divide by 12 to find a monthly amount.

Now you'll know what the real difference is between your inflow and outgo. The next thing to do is figure out where you can cut back a little here a little there. Can you make two fewer long distance calls per month? $5. Can you eat on $5 less per week of groceries (that would be $20 a month)? What about gasoline? Snacks? Cut a bit from each element of your outgo, and you may find you can make up the difference.

If there's still a shortfall, maybe you can get your cc's caught up (and therefore lower that monthly payment by a bit by eliminating late fees and overlimit fees and all that other stuff that stacks up) by selling some items on ebay. Or your husband could post a list of items you have for sale at his work place. Have a yard sale. These are temporary measures just to get things caught up, but they might be enough, and they'll certainly help.

Then, you'll have to find a way to make up the difference in your monthly budget. If you can't do it by cutting back, you'll have to get creative for getting more income. Do you have any skills such as typing or tutoring that you could do one or two nights a week? Can your husband deliver pizzas a couple nights a week? Most places may not want to hire him without weekend availability, but there's sure to be one or two places that have an opening for just the nights he's available--he may just have to look around a bit. Do you sew? Maybe you could pick up a little bit of piece work.

The main thing to remember is that whatever difficult measures you have to take to get out of this, it's only temporary. I had to work nights for six months while my husband worked at a job he hated 40 hours a week. We never saw each other, and my two-year-old resented my husband because he associated him being home with my being gone. It stunk. But we got through because we knew it wouldn't be forever. Eventually, dh got a promotion and we got enough of our debt paid to bring our payments within a range we can pay on his salary alone, and now we're back to being a one-income family, and we love it. It was *so* worth it for six months to get into the position we're in now (we still owe five digits worth of debt, but we're paying it all on time and a little extra each month). We also learned a lot about being really, really frugal. We eat (and get detergent, toilet paper, and other necessities) on $45 a week. I no longer drive long distances to go to cool parks and locations with my son--we stick to the ones close to home. And so on. I also had to give up my part-time business doing freelance business writing, but now I am able to do a very-part-time business writing for local (and, hopefully soon, national) magazines, and without the stress of wondering whether the checks will come before the electricity gets disconnected or the landlady knocks on the door wondering where her check is.

Good luck, and I hope some of this helps you.

Blessings,

Heather

Avatar for noahs_mommy2007
iVillage Member
Registered: 04-17-2003
Mon, 05-19-2003 - 4:41pm
As far as the attorney contacting you regarding a credit card, you can set up a payment plan with them. I have had this happen and I simply wrote them a letter explaining my situation and told them that I could pay a certain amount per month and when I could pay it every month. Do this. I was scared at first because I wondered if they would accept this and they did! DON'T DEFAULT ON THIS THOUGH! Once you have made payment arrangements, you must pay it every single month or they will set up a garnishment and have it taken from your paycheck. I got a letter in the mail this weekend saying that a previous judgment regarding my hospital bills had been settled and it felt so good. Good luck!

Tammie