January 20, 2020

CCCS vs. Bankruptcy – What Makes the Most Sense?

I am sitting here wondering two things…am I qualify to file bankruptcy and should I file bankruptcy.
I have unsecured debts…c/Cards and student loans avg. 50,000.  I have a mortgage of 1.000 monthly.  I AM ENROLLED IN CCCS AND IS PAYING ABOUT 900.00 monthly.  I have high medical bills and child support payments avg. 600 monthly…after working many many hours of overtime my income last year was 54,000.  I am single/seperated…what should I do and how should I do it….HELP.

Jonathan Ginsberg responds:  Jeff, thanks for your question.  Here is how I would analyze your situation:

  1. Bankruptcy is always a last resort.  Whatever positive information you hear about bankruptcy (and there are some positives), you always run a risk when you file for bankruptcy.  Why?  Your financial future will be in the hands of others (trustees, judges).  Creditors can put you in the position of having to litigate (expensive) or give up bankruptcy protection.  While most bankruptcy cases process through the system without hassles, there is always the chance that your case could blow up.  Additionally, you will see your credit score destroyed (at least in the short term) if you file for bankruptcy.
  2. Given your income, I would think that you would be limited to filing Chapter 13.   Although the median income limit for a single individual changes once or twice a year, the current median income for an individual filing in Georgia will be in the $40,000 range.  Your income is significantly higher – therefore I suspect that you will be looking at a Chapter 13.
  3. Currently, you are paying $900 per month + your mortgage + high on-going medical expenses.  Chapter 13 might make sense if it could reduce that $900 payment to $600 or  $500.   The only way to know that would be to submit all of your financial information to a bankruptcy lawyer for a personalized review.  If you want me to review, I would direct you to a special download page of my Atlanta bankruptcy web site, where I identify exactly what I need to analyze your specific case for a possible bankruptcy.


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