Should I file for bankruptcy or work with a debt management agency?
My husband was out of work for almost a year and I lost my job. We have almost 30k in debt on credit cards. We have never been late with payments but it is starting to get tight. Should we file bankruptcy or contact a debit management agency?
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The ability to file bankruptcy is not determined by your debt, but by your ability to repay your debt. Since you say you have enough to make your current payments, you may not even qualify for a Chapter 7(liquidation) bankruptcy.
To determine if you qualify there are two means tests you must pass first. The first is if you earn more than the average for your state, the second is if you have at least $100 a month of disposable income. If you fail either of these you may be forced into a Chapter 13, which is basically a repayment plan. If you do happen to qualify for a Chapter 7 bankruptcy this remains on your credit for 10 years.
Now, if you get on a debt management program they may be able to get you on a budget and work with your creditors. If this is the case you can probably be debt free in about 3-5 years. After that you are debt free and have no lasting marks. If you go this route be sure to go with a reputable organization. You can check out http://www.nfcc.org for a list of organizations that can help