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Same old story, my husband and I hit a rocky patch in life and were unable to pay on our credit cards (credit cards or house and food, tough decision). Anyway, I made several attempts to work out a payment plan with the creditors and they were never willing to do something that we could afford. As a result, I stopped making payments (I know bad decision) and am now being told that they want payment or they will take us to court. My question is, if they do take us to court, what is the worse case senaro? We are on a VERY tight budget right now (we have to young girls) and really don't have too much wiggle room. WHat is the best course of action for us to take? Should we try to work out a reasonable payment plan (if they are willing to) or just let it continue to the next step... PLEASE HELP

The worst case scenario is that the creditor sues, obtains judgment at the contract rate of interest and then commences enforcement proceedings for same (ie. Garnishment of wages or bank account, writ of seizure and sale against your home, etc.)

Working out an arrangement with the creditor, either by yourself or through a credit counselling agency, may be your best option. Any such agreement ought to be in writing.

If you don't take any preventative measures legal action may follow which will only add to the creditors expense and possibly make it harder to settle. In addition, the filing of a lawsuit will only further damage your credit rating.

If all else fails, and you cannot afford the payments that the creditor demands, then you may want to consider bankruptcy.

I've considered bankruptcy but don't exactally understand the new laws. I don't want to loose our home and really don't know how to start the process.

We are not experts on bankruptcy law and as such we cannot advise on the process. For your information there is another forum on this website dedicated to bankruptcy-related questions.

I've considered bankruptcy but don't exactally understand the new laws. I don't want to loose our home and really don't know how to start the process.


If you are serious about bankruptcy find an Attorney who offers free first consultation, go in with a list of your bills and assets and see what is recommended.