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I Can’t Pay My Regular Expenses AND My Debt. What Do I Do?

Posted by Elyssa Tenenblatt | Apr 22, 2022

Unemployment has run out and you haven't received your first paycheck from your new job, your forbearance on your mortgage is ending, your student loans are coming due again, and your credit card minimums are rising because you've been using your cards to get by. You have a choice to make this month, what do I pay, and what can I get away with not paying?

            You may be surprised how often I get this question when discussing debt options, like bankruptcy, with potential clients. They are at their wits end and do not know how they are going to pay all their bills and expenses going forward. Many people make the choice to continue paying their credit cards and not their more important expenses, such as rent, mortgage, or vehicle payment. There are some bills and expenses that should be a priority, and others that can be avoided, if necessary.

The MOST important bills to pay each month are your secured debts, if you wish to keep the property securing the debt. Secured debts are debts that are secured by collateral, like a vehicle secured by the loan or a house secured by the mortgage and note. In order to keep a roof over your head, and a vehicle to get to and from work, you need to make sure those expenses are paid monthly. Falling behind on those will make it difficult to catch up and you do not want to risk being foreclosed on, evicted, or having your vehicle repossessed.  

Another important group of expenses are your utilities and living expenses. You want to make sure to pay your electric bill so that your power is not turned off, and pay your phone bill, if you need a phone, which most people do. Also, make sure to have enough spending money for groceries and other necessary living expenses. The best way to make sure you are living within your means and can pay for your most necessary living expenses, is to create a monthly budget. Also, review the monthly items you pay for such as Netflix, Amazon Prime, Ipsy, etc. and cut some of those expenses out. You would be surprised how quickly those monthly subscriptions add up and can provide you with some relief in your monthly budget.

If you have to make a choice of what bills not to pay for the month, you will want to choose your unsecured debts. These are debts that are not secured by any collateral, such as credit card debt, personal loans, and medical bills. These debts are the ones that can generally be discharged in a bankruptcy. Not paying these debts will not cause you to be evicted or lose your means of transportation. You cannot be arrested or charged criminally for not paying these debts. You can be sent to collections, you can have a lawsuit filed against you, and the creditor can attempt to garnish your wages or levy your personal property if they obtain a final judgment against you in a lawsuit, but if you are proactive, you can avoid these actions. An experienced bankruptcy or civil attorney can discuss your options with you if you end up having to stop paying your unsecured debt.

If are concerned about what bills need to be paid this month and what will happen if you don't pay certain bills, it is best to speak to an experienced bankruptcy attorney. Holland Law Group has experienced bankruptcy attorneys that can provide you with advice regarding these issues. Call now to schedule your free consultation.

About the Author

Elyssa Tenenblatt

Elyssa M. Tenenblatt is from Bradenton, FL. She received her J.D. cum laude from Western Michigan University Cooley Law School where she was a member of the Dean's List and Honor Roll each term. She was a Senator before being elected as Secretary of the Student Bar Association. She was also elected a...

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