The premise behind this post will most likely cause a little controversy. Many families are struggling maintaining their minimum monthly payments to credit cards. They make their monthly payments, yet they barely make a dent in the overall balance owed. Basically they are treading water. If you have 5-6 credit cards with balances, you could easily end up making minimum monthly payments in the neighborhood of $1,500.00 to 2,000.00 a month! That is a lot of money spent each month to tread water financially.
Lets say for example you had approximately $60,000.00 in credit card debt and your minimum monthly payments were around $1,300.00 a month. How long will it take you to pay off that debt just paying minimum monthly payments? The answer is easy to find, just look at your next credit card statement, usually towards the end of it is an analysis that tells you how long it will take to pay off that credit card just paying minimum monthly payments. The ones that I have reviewed recently with clients usually range from 18 to 34 years! That assumes that you are not continuing to make charges on the account! That is no way to live.
There is another option, you may be able to file a chapter 13 bankruptcy and get rid of your debt within 60 months! The Chapter 13 Bankruptcy would typically freeze the balance owed on the subject accounts to the amount that was owed at the time the bankruptcy was filed. That means no continuing interest, no more treading water. I filed a case for a client where she was paying approximately $1,300.00 a month in minimum monthly payments and going nowhere in reducing the balances. We designed a chapter 13 bankruptcy plan that was confirmed by the court that lowered her payment $958.98 a month! This changed her life.
Her case and outcome are specific to her situation and your situation may be different, but isn’t it worth exploring an alternative to being tapped in the minimum monthly payment cycle? Think about it, if you are only paying minimum monthly payments, who are you working for? Yourself and your family or for your creditors?
If you are considering filing for bankruptcy, it is important that you speak with a bankruptcy attorney who can help you evaluate your potential homestead exemption and issues that may impact your exemption status in bankruptcy. Every bankruptcy case is different, so what has worked for one debtor may not necessarily work for another. If you are in Miami-Dade County or Broward County, Florida, please feel free to contact us to set up a FREE consultation to discuss your specific situation.
This blog post is made available for educational and informational purposes only and to promote a general understanding of the law, and not to provide specific legal advice. Use of this blog does not create an attorney-client relationship. Reading this post is not a substitute for obtaining legal advice based on the unique facts of your situation from an attorney licensed to practice law in your state. No representation is made regarding the current state of the information contained in this post. Examples that may be provided in this post are merely for illustrative purposes; the results in your case may be different and no results are guaranteed.
Matthew Mazur, P.A. is a debt relief agency. We help people file for bankruptcy relief under the Bankruptcy Code.
Copyright 2015 Matthew Mazur, P.A.