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credit card debt

Macy’s Problem:
Macy was current with her car payments, but she fell behind on her mortgage, and had accumulated about $19,000.00 in credit card debt. A foreclosure had started on her home, and she was not able to catch up on her mortgage payments, or to pay off her credit card debt.

TBC’s Solution:
Macy’s TBC attorney told her that if she filed a Chapter 13, she could stop the foreclosure and catch up on her house payments over time; however, she would not be able to afford her regular household expenses once the Chapter 13 plan payment would be deducted from her salary.  Instead, Macy filed a Chapter 7 Bankruptcy with TBC. Unless she could catch up on her mortgage payments, she would lose her house to the foreclosure. Macy decided to take enough money out of her 401k to get caught up on her house payments. The Chapter 7 Bankruptcy wiped out her unsecured credit card debt, allowing her to be able to afford to keep her house and car payments current so she would not lose them.

Paul & Kim’s Problem:
Paul & Kim had over $10,000.00 in credit card debt and debt from high-interest loans. (Some of their loans had interest rates running between 149%-180%.) The couple did not think they could ever pay off the loans with just their current income.

TBC’s Solution:
  Paul & Kim met with a TBC attorney to discuss their options.  They reviewed both types of bankruptcy available to them, and the costs, advantages and disadvantages of each. Paul & Kim knew that it would take them many months to save the retainer fee necessary for the Chapter 7 bankruptcy, so they decided to file a Chapter 13 Repayment Plan. The bankruptcy stopped creditors from contacting them for payment, stopped the addition of any interest to their debts, and got rid of all of their debt within three years for a total monthly payment of just $80.00 – not much higher than the required monthly payment for just one of their loans.  TBC was able to file motions that allowed Paul and Kim to keep the $2600 of collateral they had pledged against some of the loans.  (*Please note:  The minimum Chapter 13 payment in the Southern District of Illinois has since been raised to $110.00.*)

Jessie’s Problem:
Jessie had over $52,000 in unsecured debts and was unable to pay them off with her income.

TBC’s Solution:
Jessie’s TBC attorney determined that she would lose $10,000 in property (or have to pay $10,000 quickly to a Trustee) if she were to file a Chapter 7 bankruptcy.  Jessie opted to file a Chapter 13 bankruptcy, which would allow her to protect and keep her property as well as eliminate her debt.  Over the five years of the bankruptcy, Jessie paid $270 per month ($16,200) to wipe out her unsecured debts of over $52,000 plus the interest she would have been required to pay on the unsecured debt.

Veronica’s Problem:
Veronica had over $30,000.00 of credit card debt and unsecured loans that were more than she could afford with her income.

TBC’s Solution:
Veronica’s TBC attorney determined that her income was too high for her to qualify to file a Chapter 7 bankruptcy.  Veronica therefore decided to file a Chapter 13 bankruptcy through TBC.  She was required to pay 100% of her unsecured debts, as well as her vehicle payments, through her bankruptcy, and her attorney set up a plan payment of $760.00 per month.  However, not all of her creditors filed claims to be paid through her bankruptcy, and so her attorney was able to get her monthly payment lowered to just $189.00.  By the discharge of Veronica’s bankruptcy, her creditors who filed claims were paid 100% of what they were owed, and the debts owed to the rest of her creditors were wiped out.

Vikki’s Problem:
Vikki had a great deal of credit card debt and unsecured loans that were more than she could afford with her income.

TBC’s Solution:
Vikki’s TBC attorney determined that she was not eligible to file a Chapter 7 bankruptcy.  She therefore filed a Chapter 13 bankruptcy, and was required to pay back 100% of her unsecured debts, with a monthly plan payment of $740.  However, many of her creditors did not file claims to be repaid through her bankruptcy, and so TBC was able to lower her payments to $192 per month.  At the end of her bankruptcy, her debts were either repaid in full or entirely wiped out.

Scott’s Problem:
Scott had over $67,000.000 in unsecured debts and was not able to afford to pay them off with his income.

TBC’s Solution:
Scott’s TBC attorney determined that Scott would lose a significant amount of property if he filed a Chapter 7 bankruptcy.  Consequently, Scott filed a Chapter 13 bankruptcy through TBC and paid back approximately $17,750 to his unsecured creditors, discharging the remaining $50,000.  He also saved several thousand dollars in interest, late fees, and penalties on the unsecured debt by filing for bankruptcy.