How does $72,000.00 sound?
That’s how much money one of my clients owes in credit card debt. We calculated his monthly payments would be $1,563.00, with almost all of that going to interest. How long would it take to pay off those cards? We figure a minimum of 15 years. So, over 15 years, how much money will he pay toward those cards? Let’s do the math.
If you multiply the $1,563.00 monthly payment by 12 months, that equals $18,756.00 for a year. Then multiply $18,756.00 by 15 years and you get $281,340.00 ….. for a credit card debt of $72,000.00
The client and I are looking at two possible solutions for bankruptcy help after we get some additional numbers. Then, we can decide if it’s best to tackle this as a Chapter 7 bankruptcy or a Chapter 13 reorganization bankruptcy.
If the client has enough income over the next five years to pay the $72,000.00 in full, then he will save about $200,000.00 and 10 years of paying the debt if he files for Chapter 13 bankruptcy. The entire $72,000.00 will be paid in 5 years at zero interest.
If he is eligible for a Chapter 7 bankruptcy, which is a possibility given his personal circumstances, he will save the entire $281,340.00 in payments or the $72,000.00 lump sum balance.
There are other options as well, such as a Chapter 13 Plan that will have him pay a portion of the $72,000.00 debt that is affordable to him. If you’re in a situation similar to this client, we can give you bankruptcy help. But you will never find out unless you set up a time to meet with us for a free consultation with one of our bankruptcy lawyers at Steidl & Steinberg.
What do you have to lose, besides $281,340.00?