By Dan Samaria
Publisher/GCC
Oct. 16, 2009

Editor’s Note: There are many sites that can help you with dealing with debt. This site we use weekly with advice it called The Ask Doctor Debt.

They have answers to many frequently asked questions regarding debt and credit problems.

This week we will be giving you some FAQ that have been sent to their site. We hope that this will help you, in dealing with debt.

If you have any questions, you can reach us dan@goldcoastchronicle.com

 

(Q)  I recently went through a divorce which left me with credit card debt. On top of that I have a student loan and monthly child support to pay. Most of my salary goes toward rent and other bills.

What should I do? My sister belongs to a credit union so I’m going to try to get a loan from them. I’ve heard the interest rate could be 10 percent or higher on a loan. Is bankruptcy an option?

 

(A) You should first contact the credit union to determine if they can consolidate your debts into one loan with one interest rate or refinance your existing debts at lower interest rates. If you financed your car through a dealership, the credit union may be able to refinance that loan at a lower interest rate. The credit union can calculate what your monthly payment will be so you can figure out if it’s less than the amount you pay now. Bankruptcy is a last resort.

It will have a negative impact on your credit for several years. Also, your student loan would not be dischargeable in a bankruptcy unless you can prove that paying the student loan would be a substantial hardship. In order to maintain good credit, make sure to pay your bills each month on time. It’s to your advantage to pay your bills early, if possible, as that may result in an increase in your credit score.

Source: Ask Doctor Debt