Feeling overwhelmed with monthly bills, Lin got a second job to help pay her debt but has had difficulty writing a budget and still falls short each month. She currently rents her home, and she has credit card bills, student loans, and a car payment. What step should Lin take next?
Answer
A
Lin should contact a credit counselor to create a workable debt management plan.
B
Lin should contact an attorney to discuss the possibility of filing for bankruptcy.
C
Lin should take out a personal loan in order to pay her monthly expenses.
D
Lin should take the means test to see if she qualifies for Chapter 13 bankruptcy.
Explanation
Lin is struggling to make a budget and cover her payments, so a credit counselor can help her review her income and expenses and create a realistic debt management plan. This is a practical next step before considering bankruptcy. Taking out another loan could increase her debt, and the means test is associated with determining eligibility for Chapter 7 bankruptcy, not Chapter 13.
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