My husband and I have really gotten ourselves in deep this time. At the time, we thought starting a franchise using our personal credit cards was a good idea. The manager we hired was inept and untrustworthy. Now we are in credit-card debt to the tune of $250,000. We are trying to crawl out from under this problem and are out of working capital to keep things going. We can’t find anyone who will make us a consolidation loan. We are sinking fast! Name withheld, Texas
I wish you’d written before you headed down such a dangerous path. Instead you violated nearly every rule of self-employment: You went into business with borrowed funds. You hired employees before you were profitable. You thought of credit as “working capital.” Need I go on? I will say that if there’s one thing you did right it was not taking out a home-equity loan to fund this nightmare. As much as your unsecured creditors may scream and yell, hassle and harangue, they cannot take your home. But they can sue you if you are unable to keep up with your monthly minimum payments.
While bankruptcy is legal, I find it to be neither moral nor ethical. While you might be relieved of the burden through bankruptcy, discharged debts don’t disappear and there might be tax implications. However, it pains me greatly to suggest it’s probably time for you to consult with a bankruptcy attorney. Read more