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Old 02-16-09, 04:40 PM   #1
DataJunkie
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Bankruptcy question

My lovely wife apparently racked up over $10,000 in credit card debt unbeknownst to me.
Before I chat with a bankruptcy lawyer I was curious how this will affect me. Meaning will her creditors find a way to come at me for my wife's debts?

Details:
1) We are cosigned on the house and two car loans. I am the primary borrower.
2) She thinks claiming the bankruptcy where she will have to repay is her only option. The lawyer she consulted with stated that my income is too high to claim total bankruptcy. He has also stated that I will be fine according to her. My trust in this statement is nonexistent.
3) I am not cosigned on any of her credit card debt.

Thoughts? Supposedly she is so far behind that my wife does not think I can dig her out of the tremendous hole she has dug herself into. How will this come back to bite me or will it?
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Old 02-16-09, 04:45 PM   #2
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community property? It's both of you. If you are planning on staying married, it's still both of you....
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Old 02-16-09, 04:53 PM   #3
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Supposedly she is so far behind that my wife does not think I can dig her out of the tremendous hole she has dug herself into. How will this come back to bite me or will it?
Behind on the $10k + compounded interest, or just the card balance(s) of $10k total (plus more compounding yet to come of course)?
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Old 02-16-09, 05:09 PM   #4
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Suck it up, reduce your lifestyle and pay it off. Cut up the cards. $10k is not that much money. You could pay it off in a year. Live and learn.
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Old 02-16-09, 05:10 PM   #5
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Important data here is when did she rack up these credit-card debts; before or after getting married to you? Also you should also look up the changes in bankruptcy law that Bush passed. Bankruptcy no longer absolves you of those debts, just buys you time in setting up a payment schedule with your debtors.
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Old 02-16-09, 05:20 PM   #6
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10K is not that much unless you are way strung out on house and car debt. Hell, plenty of people have many times that in student debt before they get their first jobs.

If you have any equity in your house, you could at least pay off the CC debt and refinance it at a much lower rate.

As has already been stated, your wife's debt is your debt if you plan to stay together.
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Old 02-16-09, 05:29 PM   #7
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If you have any equity in your house, you could at least pay off the CC debt and refinance it at a much lower rate.
Or a 401k to borrow from.
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Old 02-16-09, 05:39 PM   #8
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Or a 401k to borrow from.
Be wary of this though....great option if you know you will not be laid off. If you get laid off you have to pay it back ASAP or it will count as income and screw you on taxes.
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Old 02-16-09, 05:44 PM   #9
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Suck it up, reduce your lifestyle and pay it off. Cut up the cards. $10k is not that much money. You could pay it off in a year. Live and learn.
yep, suck it up, and pay it off
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Old 02-16-09, 05:47 PM   #10
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I would advise not to use home equity to pay off credit card debts. One year later, you could be in the same situation with your home in jeopardy. Sell a car, take the money and the car payment and put it towards paying the cc. Sell other things to raise cash. Bag lunch. Cut the tv cable and the cell phones out. Reduce costs everywhere and in a short time the crisis will pass and you will have learned to live within your means. When I say you, I mean you as in the marriage and household.
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Old 02-16-09, 06:47 PM   #11
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Colorado is not a community property state. She is responsible for her credit cards. You are both responsible for the house and the two car loans.

Are you looking at divorce in this case?

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Old 02-16-09, 07:25 PM   #12
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I can't believe you are even considering bankruptcy. Although I don't know your situation, $10,000 does not seem like a lot of money, certainly not enough to declare bankruptcy. Sometimes you just need to buck up and do the right thing rather than look for the easiest path.

We all pay for others bankruptcy.
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Old 02-16-09, 07:38 PM   #13
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I'm not considering anything. My wife is. It is my desire to extricate her from the disaster she has made. Try being married to someone who is bi polar...
Anyhow, divorce may be in the future but first things first. As usual it is up to me to fix things but I believe a visit to the marriage counselor is in order.
Just researching things first. No harm in asking the question right?

...and yes Colorado is not a community property state.
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Old 02-16-09, 07:42 PM   #14
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Try to avoid the bankruptcy if at all possible. It might do her well to learn a lesson from having to HTFU and work her way out of it. If you can possibly use another means to pay off the CC with a lower interest source, that would be something to consider, but I'm sure you could also work out a deal with the CC company for a payment plan that might save you the normal crazy interest. Either way, the card gets cut, of course. Good luck buddy, I know your pain.
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Old 02-16-09, 07:44 PM   #15
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Quick question: Who pays the bills? I mean, who writes the checks every month? Do you pay yours, and she pays hers?

Call me paranoid, but if she managed to hide $10k of credit card debt (any idea where that went?) that would make me leery of her knowing what my account numbers were. If she has some kind of compulsion that you aren't aware of, she might be tempted to use yours w/o asking.

-Contact the cc issuers and explain that you think that your cards may have been compromised at your end. You want to close those and open new ones. Have the statements sent to your private email.
-Find out how she incurred that debt. You have a right to know, seeing as how you're on the hook to repay, in part or whole, her debt.
-Check out the Dave Ramsey show. You'd be surprised at the number of people calling in with similar stories. The repeats are on Hulu.com
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Old 02-16-09, 07:44 PM   #16
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EEEK! Hold on.

Okay, I've been there. Twice. There is such a thing called "credit counseling". It will take a few years to pay off this debt, but you can do it. Find a non-profit credit counselor like CCCS and go through them. The way it works is this: You agree to freeze all your credit and not take any more on. It sounds tough, but it's not as bad as you might think. The counseling service sets up agreements with your creditors (credit cards/unsecured loans only, not mortgages, car loans or student loans) which usually involve a lowering of interest rates and monthly payments. You pay the counseling service once a month, and they pay the credit cards for you. There is usually an administrative cost associated with this, but it is far, far less than the money they will save you in interest.

While you're in the repayment plan, your credit rating is similar to someone who has a bankruptcy on their credit report, but as soon as the payments are complete it will probably bump up to higher than it is right now. You can expect it to take 3-5 years to pay off. Credit companies prefer to do it this way because they get most of their money and they know someone is keeping an eye on you to make sure you pay things back.

I got laid off during credit counseling and they were able to lower our payments even more until I found work. A good credit counseling service can be your advocate with the credit companies.
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Old 02-16-09, 07:47 PM   #17
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Thanks chip

Just to be clear I have no intention of declaring bankruptcy. She wants to declare it on her own and whatever type that requires a payment plan.
I am trying to convince her this is a bad idea. Personally, I would rather give her X amount of cash to get caught up and force her to pay it back. Somehow I will need to monitor it.

You know what is worse than this BS having happened... being repeatedly lied to. Just gives me the warm and fuzzies. Anyways....
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Old 02-16-09, 07:52 PM   #18
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Thanks chip

Just to be clear I have no intention of declaring bankruptcy. She wants to declare it on her own and whatever type that requires a payment plan.
I am trying to convince her this is a bad idea. Personally, I would rather give her X amount of cash to get caught up and force her to pay it back. Somehow I will need to monitor it.

You know what is worse than this BS having happened... being repeatedly lied to. Just gives me the warm and fuzzies. Anyways....
What did the spend 10 grand on? Can you return/sell any of the stuff? Maybe buy a new bike with the proceeds (I'm keeeding! )
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Old 02-16-09, 07:54 PM   #19
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Quick question: Who pays the bills? I mean, who writes the checks every month? Do you pay yours, and she pays hers?

Call me paranoid, but if she managed to hide $10k of credit card debt (any idea where that went?) that would make me leery of her knowing what my account numbers were. If she has some kind of compulsion that you aren't aware of, she might be tempted to use yours w/o asking.

-Contact the cc issuers and explain that you think that your cards may have been compromised at your end. You want to close those and open new ones. Have the statements sent to your private email.
-Find out how she incurred that debt. You have a right to know, seeing as how you're on the hook to repay, in part or whole, her debt.
-Check out the Dave Ramsey show. You'd be surprised at the number of people calling in with similar stories. The repeats are on Hulu.com
I pay the bills and we have our own separate spending accounts.
I knew things were up but this was surprising. Like I said Colorado is not a community property state. Helping her out is more of a husband wife thing than legal.
6 months ago I cut her access to the household account due to her spending. Bi polar folks + CC or DC is a bad idea. I give her cash once a week.
Anyhow, time to drag her to marriage counseling and in the meantime figure out how to fix this. Perhaps a credit counselor. Perhaps no. We will see.
Incidentally, my wife's credit rating is the polar opposite of mine. Egads.
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Old 02-16-09, 07:55 PM   #20
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What did the spend 10 grand on? Can you return/sell any of the stuff? Maybe buy a new bike with the proceeds (I'm keeeding! )
I have no f'ing clue! She doesn't have crap.
I am at a loss. How does one spend $10,000 and not have anything to show for it?
I would at least have a boatload of bikes.
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Old 02-16-09, 09:00 PM   #21
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I have no f'ing clue! She doesn't have crap.
I am at a loss. How does one spend $10,000 and not have anything to show for it?
Could it be gambling?

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I would at least have a boatload of bikes.
EDIT: Haha, I thought you said "bites."
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Old 02-16-09, 09:12 PM   #22
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I have no f'ing clue! She doesn't have crap.
I am at a loss. How does one spend $10,000 and not have anything to show for it?
I would at least have a boatload of bikes.
Easy...spend $800/month on clothes for a year. That's not a lot of items if you buy designer-label stuff.

Be very wary about bankruptcy...with the rule changes of recent years, you can wind up still owing most of the money...plus the lawyer's fees...
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Old 02-16-09, 09:12 PM   #23
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What prevents her from doing it again?

Take it from someone who's wife cheated for 5 years without
me having a clue... a spouse can be quite deceptive. Protect yourself at
any/all expense.
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Old 02-16-09, 09:19 PM   #24
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My lovely ex-wife apparently racked up over $10,000 in credit card debt unbeknownst to me.
fixed that for ya

seriously - that's f'd up. move on
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Old 02-16-09, 09:26 PM   #25
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The gambling suggestion is an excellent thought. One of those online casinos or poker websites, if Colorado does not have actual casinos. If so, you may get this debt paid off, but will she incur additional gambling debts in the future? Or could she have been doing day trading of stocks?
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