What happens when you can't settle with the Pre-legal Department?

[heket]

So with an unemployed dh, an unpaid maternity leave (twice in the last 2 years), and me working part time, we've been having some issues with paying the creditors. Now the pre-legal department has given me their final offer, for which unless we take out one of those payday advances, we won't be able to pay. If we can't come up with the $$$, what happens next? Anyone with any info, BTDT stories?

[Treasuremapper]

I strongly suggest you check out the wealth of information in http://www.creditboards.com and post your question there, too.

Also, remember to consult with a bankruptcy attorney soon -- the new bankruptcy laws go into effect in a week or so.

[wednesday]

It depends a lot on what your assets are and what state you live in. In some states a creditor can have your wages garnished--however if you're not working anyway that isn't much of a threat, is it? I mean if you're a family of four on one part-time income I don't THINK the average judge is going to order much of a garnishment, although I don't totally know how that works.

If you own your home your creditors can file a lien on your home, so that's pretty serious. If you can't pay and if things aren't going to change anytime soon, you should very seriously be considering bankruptcy. In many if not most cases people are able to keep their homes as long as they can keep making the payments.

[heket]

Thanks for the link, I'll be checking it out.

Well, we don't own our home and the car is paid -- that's about our only asset. I will be starting a full time position in two weeks, so I would be able to start paying some of this off then. I assumed that wage garnishment was going to be their next step (I'm in CA)

Is bankruptcy next step?

[wednesday]

heket, I tried to PM you but your box was full.

[Treasuremapper]

Bankruptcy is an option, but you need to get to a BR atty before the deadline. Check out the credit boards link I gave you above, they have TONS of information on everything. For example, paying off debts and making sure that nothing goes on your credit report when you pay it, etc.