Dealing with Debt Article


Dealing with Debt

Dealing with Debt

Perhaps your debts have become unmanageable now that you are living on a fixed or more limited income. Maybe the unexpected costs of medical treatment or prescription drugs have pushed you to the brink. How you deal with the situation will depend on your particular circumstances.

What should I do if I am having trouble paying my bills?

You could contact your creditors and ask for more time to make payments. It might help to call a credit and debt counseling agency as well. Keep in mind that if you wind up filing for bankruptcy, you will be required to complete such counseling from an agency approved by the U.S. Trustee Program.

Be cautious about obtaining a debt consolidation loan to pay off your debts. If the interest is too high, you could wind up with an even bigger problem. And if you do get a loan, make sure that the financial statements turned over to the lender are true and complete.

What are credit and debt counseling agencies?

If you are in debt and finding it difficult to pay your bills, credit counseling can help. Reputable credit counseling organizations advise you on managing your money and debts, help you develop a budget, and usually offer free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and debt management, and budgeting.

Counselors should discuss your entire financial situation with you, and help you develop a personalized plan to solve your money problems. An initial counseling session typically lasts an hour, with an offer of follow-up sessions.

A reputable credit counseling agency should send you free information about itself and the services it provides without requiring you to provide any details about your situation. If a firm doesn’t do that, consider it a red flag and go elsewhere for help.

Check out a potential agency with the Arizona Attorney General’s Office at (602) 542-5763 (Phoenix), (520)628-6504 (Tucson), or (800)352-8431 (Outside Phoenix and Tucson), and the Better Business Bureau (602)264-1727 or (877)291-6222. They can tell you if consumers have filed complaints about them although this is not a guarantee that they’re legitimate. The Department of Justice on-line maintains an approved list of credit counseling agencies by State.

What will happen if I simply don’t pay my debts?

If you signed an agreement putting the property up for collateral (securing the debt) when you bought it, the creditor could repossess the item. Even in the case of unsecured purchases (purchases made with credit cards, for example) the creditor can obtain a court judgment and the property can be repossessed, your wages attached and your bank accounts seized. (A.R.S. § 44-1007)

In addition, if you own a home, a lien could be placed on your property for an unpaid debt. You may, however, be able to file a claim of exemption for your home.

If you are generally not paying your debts, you are presumed to be insolvent (the sum of your debts is greater than the fair value of your assets), and certain new debts you incur may subject you to other problems. (ARS §§ 44-1002, 1004)

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  • I made a huge mistake by cosigning on a car loan for a girlfriend back on 09/15/08. She only made 9 payments on the vehicle then let it go back to the bank. It’s been almost 6-1/2 years since she made her last payment and now they’re coming after me, after all these years have gone by. I was told that Arizona Statute of Limitations A.R.S. § 47-2725 is four (4) years for auto loans. But their attorney is ignoring that and coming after me regardless. It's now October 2015 and they are coming after me for the loan amount + interest totaling $13,000 altogether. I'm retired and living solely on Social Security of $1,776 per month and two small pensions totaling $624 which = $2,400 per month. And I'm living with my daughter to make ends meet. Therefore I can't afford to pay theses people. I had an initial pre-trial conference on 10/8/15 and represented myself because I can’t afford an attorney. It was determined that there will be a trial on 12/14/15. I told the loan company in court “that I have no money and living on $2,400 per month and living with my daughter to make ends meet, and they’re still pursuing the trial date. My questions are: 1) Will the Arizona Statute of Limitations A.R.S. § 47-2725 four (4) years get me out of this mess completely? 2) I've been told and read online that Social Security income and Pensions “cannot be garnished”. Do you know if this is true? If it's true then I have nothing to worry about and won't need to file bankruptcy. 3) If I lose my case can I file bankruptcy on a judgement that's been awarded against me? 4) Can they levy / garnish my checking account where my Social Security checks and Pension checks are electronically deposited? Thank You for your help.
  • My question is my ex boyfriend and I discussed taking out a title loan on our truck . We are both on the title. We agreed to do it but I’m the one that drove down and filed for the loan. So my name is primary on the Loan contract. After that he decides to leave me he takes our truck and blocks me so I can’t speak to him. He refuses to pay the loan payments. He also has our truck. I don’t think I should have to pay for a truck I no longer drive . They want the truck or their money ? What should I do?
  • I am full time caregiver for my my mother who is 90 and bedridden. We are living on social security with only a few thousand dollars in savings and she has over $15,000 in credit card debt. She owns the house and I need to stay there when she passes (I'm unemployed - executor & heir. Will the credit card companies be able to force me to sell the house to pay them off? Will they be able to get the few thousand dollars left in her savings account?
  • A credit card company is suing my 80 year old father thats on SSI this is his only income can they still sue him? He is in financial hardship right now after my mother passed away this last Feb.
  • My total income is $15,000 annually from ss retirement. I have $12,000 in checking for which I plan to get dental repairs. I owe $40,000 on credit cards and have not made any payments since 2005. I owe $30,000 to the IRS (irs has declared me "uncollectible"). Will my credit card debt ever disappear? I have never declared bankruptcy. Should I declare bankruptcy now?
  • 2014 we lease a car for 36 months st $ 229.00 a month gave our our 2004 mint condition as down payment supposedly % 5000.00 we need a larger vehicle we were moving so went to see what they could do.The.dealer paid off the Camry but added it to the truck,our payments now $579.91for 84 months.what the salesman didn't tell us that they wrapped amount of the Camry to the truck payment, so we are paying for 2 cars and they kept the car .We only have one vehicle. Is that legal? What they did? We pay $579.91 monthly,to much.our solely monthly low income is 1773.00 combined.we tried to refinance with other banks but were denied they said we owe more than the vehicle was worth.we are up to our neck with to many bills If we voluntary turned up the vehicle can they go after our only assets,a2bedroom little house? Please help,can't afford lawyer fees bankruptcy is not an option. We always have good credit,we manage with credit cards.
  • Would I be able to get visitation of my two children if they live in a diffrent city? They live with there grandparents and there mother live in the same city I live in.

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  • I we are surrendering our Motor Home(RV) to the bank for we cannot afford the monthly payments any longer. We are told after the RV is sold we are still responsible for the remmaning amt. owed. We think that amt. will be about $37000.00 which we cannot afford, what can we do at that point?

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