Legal Question in Credit and Debt Law in Georgia
Owe $120K to American Express
Hi
I have 4 Amex cards totalling $120K in debt. I have never been late but cannot continue to make payments and have no choice but to go into default. My husband and I both lost our jobs and have been living off our savings for the past year. I do have approximately 80K of equity in my home (so I cannot file bankruptcy). How long does it take for American Express to place a lien on my home and what is their collection process? If I continue to make payments to AMEX...I cannot make my mortgage paments or pay for the necessities for my 4 young children.
2 Answers from Attorneys
Re: Owe $120K to American Express
If you realistically cannot pay anything on the debt (and the payments certainly will increase dramatically after missed/late payments), Consumer Credit Counseling of Atlanta (www.cccsatl.org) might be able to help. If they can't, and you have to consider bankruptcy, it often makes little sense to try to hang on to a house you cannot afford (with your other debt) when an option might be to rent a cheaper place for a couple years until you get back on your feet. At $120,000, AmEx will most likely file a lawsuit and get a judgment. The debt will be $160,000 in a year with default interest, so hanging on to that to "save" $80,000 in equity is not a good trade. If one of you had a job, perhaps a Ch. 13 would be an option.
Re: Owe $120K to American Express
Your statement "I cannot file bankruptcy" tells me you have probably not talked to a lawyer. While a lot of equity MIGHT be a problem, recent changes in the real estate market may have solved that. Sit down with a lawyer to see if the option you think isn't one might in fact be one.
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