What is the best way to allocate little income before bankruptcy? 4 Answers as of November 24, 2010

I just lost my and should be receiving severance pay. I will not be able to pay my monthly expenses because my income will not be sufficient. I have negative equity in my house and significant credit card debt as well. I am almost certain that bankruptcy will be my final option as I have no savings either. Should we continue trying to pay our credit card bills even if we cannot pay our mortgage or how should would our money be best spent until the bankruptcy? On daily expenses?

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Mankus & Marchan, LTD
Mankus & Marchan, LTD | Tony Mankus
Spend your money on daily expenses.
Answer Applies to: Illinois
Replied: 11/24/2010
The Law Office of Mark J. Markus
The Law Office of Mark J. Markus | Mark Markus
You need to have a comprehensive consultation with a bankruptcy attorney to go over your situation. There's no way to tell you what the best solution is for your circumstances without getting all the necessary information.
Answer Applies to: California
Replied: 11/23/2010
Ursula G. Barrios Law
Ursula G. Barrios Law | Guillermo Machado
First off, do not use your credit cards anymore. If you barely have enough to pay your living expenses and do not anticipate enough money to cover all other bills, stick to your living expenses (your necessities). If you intend to keep your house, I would continue to pay for it each month, even if you cannot pay your credit cards. You should file for bankruptcy relief if you cannot continue to pay your debts or are finding yourself in a never ending cycle of paying interest and not paying your debts off quickly (this is called financial bondage). Recovering from a bankruptcy is easier than most people think. All it requires is income. You may contact my office for a free consultation. It sounds like Chapter7 is what you need to focus on for your debts. California laws allow you to protect a generous amount of cash, so I would save it until speaking with an attorney.
Answer Applies to: California
Replied: 11/23/2010
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