I am 22 years old and have almost 30,000 dollars in debt from a failed engagement and credit cards. I work 3 jobs and go to school to full time and try to make every payment I can on time, but it never seems to be getting better. I can't go any further in school and work this many jobs just to make ends meet. The only thing I own is a car and it is paid off. Is bankruptcy an option for me? will I lose my car? I live in TN
If you qualify for Chapter 7, depending on your assets if any, bankruptcy may make sense. In order to file bankrupcy, you must disclose the total household income. If it is over the median income for that size household in your state, you may be prevented from filing Chapter 7.
This is calculated by taking the total household income for the 6 months immediately prior to the month of filing, and then doubling it. Then you have to compare that to the median income for your state.
The ability to exempt your car would depend on what it is worth, and the exemption laws of your state.
According to the Office of the US Trustee (the division of the Department of Justice that oversees the bankruptcy process) in Tennessee currently the numbers are:
Tennessee 1person $36,308 2 people $46,927 3 people $53,149 4 people $62,226
You need a consumer law attorney who is knowledgable in bankruptcy. The National Association of Consumer Advocates (NACA) is a non-profit consumer advocacy organization. NACA maintains a web site at www.naca.net where it lists geographically consumer law attorneys all over the US. If you don't already have an attorney, please look there for someone in your area who can help you.
Divorce / Separation Lawyer
Note that I am not licensed to practice in your state.
You are 22 years old. That is extremely young and to have $30K is a lot, yes, but it isn't unmanagable. YOu can certainly file for bankruptcy IF you qualify but know that it will ruin your credit for years to come. Your credit dictates everything from interest rates on car loans, mortgage loans, credit cards and it also will dictate whether you can rent an apartment or get a job. Many landlords and employers check credit reports nowadays.
If you want to start being responsible, you need to have the courage to control your life instead of looking for an easy way out. If you can't go to school because you're accumulated $30K in debt, then you should concentrate on paying off that debt first. School can wait in your situation. You will not learn a more valuable lesson in school than what you're learning now and what you'll learn by paying off this debt.
Always do what is right versus what is easy.
Chapter 7 Bankruptcy Attorney
Although I agree with everything Mr. Cheong wrote, I have a slightly different view. If you can find a way to work yourself out of the situation you are now in, by all means that should be your primary option. If, however, the situation you are in is only going to get worse and you are going to be in the same place three or four years from now, bankruptcy should be one of your options. The longer you put off the inevitable day of reckoning, the larger the impact this will have on your life. Not completing your education could impact you for the rest of your life. At your age, you have plenty of time to rebound from a bankruptcy. If you go through the bankruptcy and then go back to accumulating debt you will be even worse off. I urge you to make an appointment with a local bankruptcy attorney and carefully evaluate all of your options. Bankruptcy should definitely not be your first option but it probably should be one option to consider.