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What happens if you stop paying your cc's but don't file for bankrupcy?
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Posted by Desperate
on February 26, 2002 at 01:00:24:
I haven't payed anything on most of my credit cards in about 9 months. A couple have been charged off, some are in collections. There are several cards, but most of the balances are not that large. A handful of department store cards with balances of $300 or less, a couple of major cc's (Discover and Visa), Discover is around $1000 and Visa about $2500 and some other cards but no significant single balances. Combined, they come to about $20,000. I don't have the means to pay these anymore, most of them haven't been used in almost 2 years and are mostly just late fees, overlimit fees and insane interest. I don't want to file for bankruptcy for a number of reasons. Mainly because what little property I do have will not be exempt in my state (Michigan). I have done a lot of research on this. I also don't have the means to pay a bankrupcy attorney, it would take several months of payments to be able to do that and as these cc's are already so late I'm worried about any recourse they would take in the meantime. So, basically at this point my credit is ruined. I own my home which I will lose in bankrupcy (not because of equity, because it's a manufactured home and I'm upside down on the loan), my husband has a truck he needs for his line of work but he will lose that because of too much equity (we have another family car, really need both), and some furnishings we have are not exempt. From what I understand, Michigan isn't a very friendly state when it comes to bankrupcy. We have two children and I hate that we're in this horrid mess. We'd sell the truck, but honestly we got such a great deal on it (bought from a family member and pmts are only $109/mo payed off in Oct 02) and if we did lose it, it would have to be replaced with a comparable one. There haven't been any attempts to collect via a judgement yet, and we recently had to change our phone number so the calls aren't coming in anymore. All of the letters I receive look to be in stage 1 of collection attempts. Some companies are just still sending monthly statements that say "seriously past due". How far will most companies take this, considering no one debt is very large? And since our credit is pretty much runied now for the next 7 years, what would be the benefit to file for bankrupcy as opposed to just not paying these anymore and waiting out the 7 years until they fall off? Can we be sued, or will they try to garnish wages for such small amounts? Thanks for reading and for any advice anyone can give. This is an absolute nightmare...mostly because we don't know which road to take or what to expect.
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