I am hear to get advice like everyone else but if I could give one piece back, being left without any credit cards isn't a bad thing. Prepaid credit cards aren't so bad (Citizens Bank of Canada kind of thing), work almost as good and for most anything except maybe car rentals.

My grandfather talks of having to have a minimum amount down in his day before you could pay the balance on the credit card. I think we need to get back to those times although actually, it's kind of rewarding now having to have the money to put it on the card to make an online purchase. Wish I had done this a long time ago.

My finances are a mess but I have a new bank account and a prepaid credit card and a monthly budget. I will hopefully one day fix these finances but the hard lessons have been learned I believe will help a great deal in avoiding a similar or worse situation in later years.

$5 a month may seem like a lot to have a credit card, but it sure beats the monthly finance charges of carrying a huge debt load.

Don't fear losing those credit cards. You'll learn ways around needing them. You'll also learn a lot more and pay more attention to, your spending habits.

It's time we all help one another with our fiances because nobody should feel the anxiety these situations put on good, honest, hard working people who either fell on hard times (divorce like me, loss of a job, workplace injury, etc), or have just made some bad money management mistakes (also like me).

I have allowed this, the letters, the phone calls on all of my phone numbers from work to home to cell, battling for custody of the children and setting child support and other divorce items, but finally decided a few months ago that the finances weren't worth it. My most important concern was/is my children and what is best for them and my ability to provide for them. As embarrassing as being in the financial state I am in (almost $70K in consumer debt), as embarrassing as divorce itself is, nothing hurts more than only seeing your children half of the time so if you can learn to not let the finances get to you, to realize that losing a home or some 'things' mean nothing if you don't have your family and your health. Renting may not be a bad thing (even though I have next to no equity in my home), as opposed to the threats and bullying and harassment of creditors and collections agency and now it seems, lawyers.

There is so much information online these days, which has led me to gathering the courage to work with my creditors/colleciton agencies myself. If you are calm and collective and speak respectfully, they seem to return the tone. Some are pretty rude and will hang up on you so just be patient if you chose the same route. I may not get anywhere but once again, the lessons far outway the possibility of defeat.

I do have one question to close out this statement. I think it's sort of answered in an above post but just to be clear. I think I am close to having a judgement being placed against me (so I am told by a creditor), so what if they win and the judgement's are higher than I can afford? Does a judgement against me mean the creditor can deny my bankruptcy claim if I chose to go that route at that time?

If one creditor wins a judgement (and I have two accounts over $10K (one around $20K and one $30K), will the rest follow suit? If one tries to take so many hundred a pay and then next guy follows suit, you'd be sol and I am not referring to the Statute of Limitations. The other sol.

Just basically wondering how far I can push these negotiations before I should put my tail between my legs, file for bankruptcy, and move on. I'd save a little including just not having to say I have ever been bankrupt, by getting a low settlement from creditors. I'd save a little cash over what I'd have to pay for a bankruptcy and maybe a couple of years on my credit file. My credit is sunk right now so it's the least of my worries.

If I can keep my home which only has about $10k equity in it which I cannot borrow from under the new mortgage rules (the 80% rule), which I'd also have to claim under bankruptcy and would have to borrow back in 21 months, I'd at least be putting my monthly 'rent' towards something rather then a rental unit so I see a few benefits to fighting to see if I can get a settlement with all of my creditors (5 or 6 in total).

Bottom line is I'd like to be working towards leaving something for my children one day. If I have to lose the house and file bankruptcy, I am stuck for 7 years with this on my file and then having to work how long to build my credit up to get a mortgage again ... I'd never have anything to leave my children buying a home in my early 50's.

So many things to think about with my girls best interest at heart. Yes they will move out and get jobs one day and support themselves, but I'd like to hopefully have something to leave them when I die hopefully 60 years from now. :) That's the sort of things I think of.

Sorry about thinking there were 5 cards. I was answering the post while swapping back and forth on the computer with other work. Easy to get distracted.

If it's only 3 cards, all the better. However, it also means their individual balances willl be higher, with some over $10K, if they add up to $30K+. Thus, it's hard to say whether the creditors will choose to sue.

You are devoid of assets but still, there's your job, which they already have the contact information for and could easily garnish if a judgment were obtained. Sometimes the creditor will sue to obtain a judgment which they realize won't be satisfied right away, but are content to sit back and wait for the defendant's financial condition to improve down the road. No rush: a judgment can last 20 years or more, though some states and provinces won't consider external enforcement writs after 10 years..

With respect to the good card you still have, you mentioned it has no current balance. How would a risk manager from that creditor view the situation? He sees, upon an account review (soft inquiry), that you've got 3 other R9 cards out there with defaulted balances totaling $30K."Yikes, we're next!" has to suggest itself to him.

Hence, if they don't pull the card outright they might raise the interest rate as high as possible and decrease the limit to some nominal value like $250. Nevertheless, to reflect your new severely thrashed credit score, they would be fully justified in cancelling it as you no longer meet their lending criteria. However, without a crystal ball, it's impossible to say for sure what they will do.

As I said, I would try to avoid bankruptcy. The first one will stay on your Equifax and TransUnion files for 7 years from the date of discharge, which, in turn, will be at least 9 months from your filing date. If you file, say within 3 months, then your credit report will be severely impacted until at least March, 2018. Presently, the bad debts on the 3 cards will fall off your credit reports circa June, 2016. Besides, a trustee will cost you at least $1500 to $2000.

I would wait and see what the creditors do. Even if one or more decides to take you to small claims court, there's a very good chance easy payment terms will be awarded to you with minimal effort on your behalf.

The only downside is a judgment will stay on your Equifax and TransUnion reports for 6 years and 7 years, respectively from the date of award.

Conversely, if you end up having a judgment rendered against you, the only way I would consider bankruptcy is that if the justice wouldn't grant me reasonable payment terms AND I was unsuccessful in appealing it with a Form 20Q (which either the defendant or plaintiff can file).

Just my opinion. Ask Footloose what he would do.

Thanks for taking the time to reply!

Yes, I know not to provide any banking or other documents. Nobody gets that information I don't care what they threaten.

We have visited a lawyer and he is hesitant to sue (I think chicken) and like you said, you can't sue an employer when you are covered by WSIB, but in this case there is no WSIB coverage.

Not that it matters, but there aren't 5 cards, we have 4 and three of those are in default.

Why would the one good card want to pull theirs after periodically checking our history? I mean, they're still being paid, if they were to pull their card wouldn't they realize that they would have just added their name to the list of creditors not being paid? Cause if they pull it they'll never see another payment from me. What difference would it make to me when I can't pay the others?

So you would agree to do nothing and hope the 2 year Statute kicks in, and if they pursue this beforehand should I seek bankruptcy then or let them go and sue and obtain a judgement? Judgement or not, I still don't have anything to take from me. So would I be paying a trustee for basically nothing anyway?

Thanks again.

Well, since you have no assets left, there's a good chance that none of the 5 credit card companies will sue. And if they wait more than 2 years from the date of original default, they'll pass the statute of limitations for filing a claim for this type of debt. Once a debt is ages past 2 years, you don't have to worry about them suing you anymore - although they may well continue to threaten to. If so, you can claim the S.O.L. period as the perfect defence.

Therefore I would definitely wait to see if anyone takes you to small claims court before considering the bankruptcy route. Besides, you can always do that any time later and you'll save a lot of money if you don't need to.

As well, a bankruptcy will extend your bad credit history for at least 2 additional years from what it is now, depending on when you file. Perhaps one or two out of the five creditors will choose to sue before the limitation period runs out. If so, that still isn't so bad as you could probably work out easy terms down the road before or when it comes to trial.

Creditors constantly monitor your situation through PPSA searches and hard and soft bureau inquiries. Therefore, the one credit card you still have use of may well be pulled without warning after one of their periodic reviews.

Unfortunately, it appears your creditors know you're back at work. It increases the likelihood of being sued if they learn you have renewed income they can garnish. Once one knows, they usually all know through the bureau files. It's one big happy family: Consumer Protection under Brian Pitkin, credit bureaus, credit card companies, debt buyers and collection agencies.

Hang in there for now. It might seem surprising but I wouldn't change my phone number for a while. It might seem counterintuitive, but resist the tempatation to hide. You want your creditors to be able to easily find you until the limitation period is up.

Tell the collection agencies about your financial plight (not that they will care in the slightest) but don't send them any signed written correspondence like financial information forms or you will be getting tricked into renewing the limitation period. The thing is: you want to keep yourself apprised of what your adversaries are doing. The biggest threat to fear is having them sneak in a default judgment without your prior knowledge so you can file a defence. It could well force you into an unnecessary bankruptcy.

If you feel you have a cause of action against your former employer, you
may want to speak to a labour lawyer. A couple of friends of mine have found one very helpful. You can't sue for workplace injuries if you're covered by WSIB of course, but you weren't.

Spouse and I live in Ontario.

For several years we have had a number of credit cards. They were ALWAYS paid on time.

Few months ago one of us was injured at work, the other stays home with the children and doesn't work. There was NO WSIB to claim as this is one of the very few professions where WSIB is not mandatory. So for about 5 months we lived off savings but did not have enough to pay our credit cards on top of our daily living expenses. We had no other income coming in, just savings.

Fast forward to now. Back to work but all the credit cards except one is now in collections. Over $30,000. The one that is not in collections had no balance so it wasn't affected because payments were not missed.

Other than the usual phone calls and letters demanding full payment (yeah, riiiiiight) we have consulted with someone to reduce our debts. He advised that we wait until after claiming our Income Tax refund then file for bankruptcy.

We have no vehicle and don't own a home, basically nothing to take from us.

The collection agencies do not want to work with us at all and are just harassing us like crazy. I sent them a letter about the calls at work etc... informing them I know my rights too, so they haven't called work again - yet.

We don't know what to do now. We're so frustrated because one little work related accident (no, nothing from employer unless we sue) and wham our perfect credit history is ruined. The collection agencies not wanting to cooperate with us just leaves us with little to do. Do we file for bankruptcy or just basically change our phone number and do nothing? If they sue us they won't get anything because we don't have anything of value for them to take. Should we pay a trustee a couple hundred a month or just do nothing and hope they eventually write it off?

Like I said, it's not that we have a smug attitude about this and don't care, but a freak accident and weenies at collection agencies leave us with no other choice. It's not like we planned this; we are decent people with nowhere to turn after an accident that has ruined us financially.

If I file bankruptcy I lose my cards including the one good one I would like to keep. Everyone needs a credit card nowadays (rent cars, book a motel, online purchases). I'd REALLY like to keep the card that is still in good standing.

What should we do now?