Could You Tell Me Your Opinion On This?
I have filed for chapter 7 in Illinois and my meeting is about a month from now. I owe 14 credit cards about $60,000.00. I owe Capital One the lowest amount, about $800.00. Capital One has already contacted my lawyer with a deal. They will knock my balance down to $500.00 and give me a new unsecured card with a $500.00 balance and a $600.00 credit limit at 14% interest rate. Is this a good deal? Should a person accept a deal like this and wouldn't this be the same as paying $500.00 for a credit card? Has anyone else had similar dealings. Also at age 63, I had decided if I get out of this mess I didn't ever want anything more to do with credit cards.
Answer:
Here's what I tell all my clients: Since the purpose of filing for bankruptcy is to avoid debt such as this, I do not recommend reaffirming. You are absolutely correct. It is like paying $500 for the credit card. There are other alternatives for rebuilding your credit that will not cost as much.
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