What can I do if I’m in debt? How? 20 Answers as of April 30, 2015

I have been unemployed for almost a year and a half because of the awful economy. I always had good credit before but now I am drowning in debt which is making me so stressed out and depressed. With my health insurance and all of my credit card debt I really don’t know what I’m going to do. I don’t really have any assets or real estate. What should I do?

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GARCIA & GONZALES, P.C. | Richard N. Gonzales
I wouldn't worry about it. You are judgment proof right now. Even if creditors sue you and get a judgment, they can not collect on the judgment (you have no wages to garnish, and no real estate to place a lien on). When you find work, file a Chapter 7 and get a fresh start.
Answer Applies to: Colorado
Replied: 4/29/2015
The Law Office of Darren Aronow, PC
The Law Office of Darren Aronow, PC | Darren Aronow
The easiest thing is to file a bankruptcy and get rid of all of your debt at once. Debt settlement will be expensive and take a long time to finish.
Answer Applies to: New York
Replied: 4/29/2015
S. Joseph Schramm | Joseph Schramm
You might wish qualify for the Pennsylvania version of expanded medicaid coverage under the Affordable Care Act. This might give you basic health care coverage for free. In order to qualify you would have to fall below the Federal Poverty Guidelines based on your annual income. If you do not fall below the Federal Poverty Guidelines you might still qualify for reduced premiums under the Affordable Care Act on either the Pennsylvania or Federal Health Insurance Exchanges established under the law. This should provide you a little debt relief by lowering your health insurance costs. As for your credit card debt you probably should speak with an attorney who specializes in debt relief.
Answer Applies to: Pennsylvania
Replied: 4/28/2015
Ronald K. Nims LLC | Ronald K. Nims
Generally, I advise people in your situation to wait until you have a good prospect of a job. Then to file Chapter 7. If you file before you're likely to have an income, you'll continue piling up debts and the new debts after the filing won't be included.
Answer Applies to: Ohio
Replied: 4/27/2015
Novakov & Associates, PLLC
Novakov & Associates, PLLC | LINDA S. NOVAKOV
Seek out a competent attorney in your area and discuss whether or not filing a chapter 7 bankruptcy would be in your best interest. Then you will be able to start fresh.
Answer Applies to: Kentucky
Replied: 4/28/2015
    James T. Weiner & Associates, P.C.
    James T. Weiner & Associates, P.C. | James T. Weiner
    Call a bankruptcy attorney and get all your debts discharged.
    Answer Applies to: Michigan
    Replied: 4/30/2015
    Charles Schneider, P.C.
    Charles Schneider, P.C. | Charles J. Schneider
    Consider a bankruptcy. Your reasons are why we have bankruptcy.
    Answer Applies to: Michigan
    Replied: 4/27/2015
    A Fresh Start
    A Fresh Start | Dorothy G Bunce
    Most people chose to do nothing until they have some income and/or assets to protect, at which point they consider credit counseling or bankruptcy. Frankly, when people tell me they are ?drowning in debt what they mean varies so widely that this explanation is virtually useless in trying to advise them. They could mean less than $10,000 in debt or over $100,000 in debt. Bankruptcy can be a good choice when the debt is at least $25,000, even though bankruptcy law doesn't specify a minimum amount of debt. Since bankruptcy is an option that is realistically available to you once every 8 years, you ought to make sure you get bang for your bankruptcy buck.
    Answer Applies to: Nevada
    Replied: 4/27/2015
    Law Office of John C. Farrell, Jr.
    Law Office of John C. Farrell, Jr. | John C. Farrell, Jr.
    There are a few choices - bankruptcy, consolidation and debt settlement. I suggest you contact a firm focusing on helping client in your situation. Perhaps National Legal Center.
    Answer Applies to: Massachusetts
    Replied: 4/27/2015
    Janet A. Lawson Bankruptcy Attorney
    Janet A. Lawson Bankruptcy Attorney | Janet Lawson
    Congress wrote the bankruptcy code for you. Use it.
    Answer Applies to: California
    Replied: 4/27/2015
    Cohen & Kendziorra, P.A.
    Cohen & Kendziorra, P.A. | Robert S. Cohen
    You may want to consider bankruptcy as an option to get rid of your debt. ?Many, if not most, attorneys will offer a free, no obligation consultation to discuss your options.
    Answer Applies to: Florida
    Replied: 4/27/2015
    Richard B. Jacobson & Associates, LLC | Richard B. Jacobson
    No lawyer who has not met with you can advise you in detail on what you should do. You may be 'judgment proof,' i.e. not have anything which a creditor could take from you. If that were the case, and you were not feeling distressed by so many creditor calls, you could just ignore them. However, you are stressed by your creditors, so a bankruptcy may be a very good solution for you. Please consult an experienced bankruptcy lawyer who can review all the relevant facts with you and help you make the best decision. Regrettably, there are costs connected with a bankruptcy: a court filing fee, and a legal fee at least.
    Answer Applies to: Wisconsin
    Replied: 4/27/2015
    Law Office of Michael Johnson
    Law Office of Michael Johnson | Michael Johnson
    Contact a bankruptcy attorney in your area to discuss your options.
    Answer Applies to: Florida
    Replied: 4/24/2015
    Tokarska Law Center
    Tokarska Law Center | Kathryn U. Tokarska
    I can certainly empathize with your situation, been there myself. Truly been there and in addition to credit card debt I had and still do student loans in the six digits. I think the focus needs to be not on what once was or how you got here but how to move forward. Rest assured you are not alone. You need to get an income stream, getting a pay check if you have been unemployed for a while can be a big pick me up even if the job is not the ideal at least you have something and can work towards getting something better. I say this should be the focus because if you have no income, no assets, what will the creditors get? If you have nothing, they get nothing. They can and will probably sue because it's the only way for them to get a judgment and try to recover monies through involuntary means like wage garnishments, bank levy, recording liens on real property. But if you have none of those things nothing will be lost. You can tell them you have nothing but either they don't believe you or think that even if that's true maybe you'll get something later and we will get a piece of that. There is no law that says you have to make this much little money to qualify for chapter 7 bankruptcy just as there is no law that says you have to have a particular amount of debt. There is a law however that states if your income is above the median income (this number varies by household size and is published regularly when the numbers change) here is a link to current numbers http://www.justice.gov/ust/eo/bapcpa/20090315/meanstesting.htm you must pass something called a means test to qualify for chapter 7 discharge, although if you don't qualify for chapter 7 discharged based on the means test you can do a chapter 13, which is a type of repayment plan. So I would not worry about filing chapter 7 later, when other aspects of your life have stabilized, UNLESS you think that you will be making income well above the median and have problems with the means test. Note that just because you have income above the median doesn't mean you can't file BK, it just means that whether you can get a chapter 7 type bankruptcy discharge depends on whether you pass the Means Test. Means test, generally speaking, takes the average GROSS income (before taxes) over the previous 6 calendar months and deducts from that number certain expenses considered reasonable and necessary. Many bankruptcy attorneys offer free consults even you're not in a position to file right now or you are simply considering your options. Sometimes just going to talk to someone like this can be very helpful. We deal with this stuff all day, we're not judgmental, we get it, at least the good and caring ones do. Some people are so anxious and depressed by the fact that they can't pay their debts that they THINK that they are stuck and can't make positive progress in their lives unless and until the debt is discharged in bankruptcy. Of course this is in their mind and not having any income presents many challenges besides having to come up with legal fees to have an attorney represent you. You are not required to hire an attorney, you are allowed to represent yourself but hiring an attorney can be money well spent, especially if you are the type of person to worry a lot, have trouble concentrating and filling out 60+ pages of forms with all kinds of details about your finances, or just are too psychologically frozen to put in the time to figure out all the steps. A lawyer can take the stress away by guiding you through the process one step at a time so it's not so overwhelming. Some people believe they can't move forward until they get this behind them, but it doesn't have to be that way. You can't pay your debts, well then you can't pay. Thousands of people file for bankruptcy protection each year and many famous and very successful people have had to file bankruptcy at some point in their lives and apparently they did move on quite well. It's nothing to be ashamed of, bad things happen to good people. Luckily, unless you have student loans, you can get a second chance. When you get a discharge in bankruptcy, it takes care of all dischargeable debt (some debts are not dischargeable and others are only dischargeable if certain conditions apply) but assuming a credit card company sues you, gets a judgment, the debt is dischargeable, when you file BK that debt will be discharged too even if they have already sued and got a judgment. The judgment will be useless. So, unless you have some assets to protect, money in the bank, wages, real estate property, investments, things of that nature, there shouldn't be a reason to run out there and get a bankruptcy filed right away. I've been handling bankruptcies since 2008 and I've seen all kinds of clients in all kinds of difficult situations. I've also had clients who were in almost identical situations with almost exactly the same past and current situation and I noticed something very important especially if such identical clients hired at the same time so that I was handling two very similar cases simultaneously. Naturally, both of clients were upset, angry, frustrated, sad, etc. yes, how could they not be. But one would worry about every little thing, beat themselves up constantly, put themselves down, drag their feet through the entire process. The other while of course concerned that the case goes well, kept their cool, they worked it out for themselves in their minds that yes this is horrible, they never ever want to go through this again, but it's something they're going to go through and they were looking forward to starting over and had other plans for themselves. Similarly, in couples, one couple would bicker and have resentments, that's when I would hear things like "you never this or that" or "it wasn't like this before". Both clients went through the exact same process, ended up in the same exact place at the end of the case but boy they sure had a different experience. One endured it like a horrid tragedy and the other like an obstacle they simply needed to get over. The key is this, they end up at the same place at the end but how was the time spent getting there - horribly awful or ok? That was up to the individual and the attitude they had. In my humble opinion, the way they endured the bankruptcy process, is likely to also be how they will endure other challenges in life and what will happen to them afterwards, what choices and paths they will choose, what opportunities they will see. The more resilient the better the ride, I think, even if that ride is bumpy.
    Answer Applies to: California
    Replied: 4/24/2015
    Danville Law Group | Scott Jordan
    Consult with a local bankruptcy attorney for specific advise and strategy. You may very well be judgment proof.
    Answer Applies to: California
    Replied: 4/23/2015
    Kenneth A. Parker, P.C.
    Kenneth A. Parker, P.C. | Ken Parker
    Please call a Bankruptcy Attorney to discuss your situation. Most Bankruptcy Attorneys will give you a free consultation.
    Answer Applies to: Georgia
    Replied: 4/23/2015
    Law Office of Darin Kanfer | Darin J. Kanfer
    Bankruptcy may be an option if most of your debt is unsecured. Your credit will be severely affected by filing.
    Answer Applies to: Michigan
    Replied: 4/23/2015
    Patrick W. Currin, Attorney at Law | Patrick Currin
    If you haven't income or assets it may be a good time to erase your debt and start over with BK. Consult an attorney.
    Answer Applies to: California
    Replied: 4/23/2015
    Law Office of Joshua R.I. Cohen
    Law Office of Joshua R.I. Cohen | Joshua Cohen
    Worry about it when you land a job. Then talk to a bankruptcy attorney who can get rid of your debt and allow you to keep your paycheck.
    Answer Applies to: Connecticut
    Replied: 4/23/2015
    The Orantes Law Firm
    The Orantes Law Firm | Giovanni Orantes
    It sounds like you are in exactly the situation for which the Bankruptcy Code was enacted and should explore what relief a case under the Bankruptcy Code would give you. You need to know which Chapter you qualify for and is advisable for you.
    Answer Applies to: California
    Replied: 4/23/2015
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