Should I file for Chapter 7 Bankrupcy?

Situation:

You have recently had some serious problems and have gotten yourself in a financial bind. You are in the hole $600 a month. You have $12,000 in credit card debt, a car loan for $12,000 ($3000 upside down). You have $12 K in 401K and $3000 in  savings.

Solution:

Start looking & getting a 2nd job to just get out of the negative cash flow situation. Use that $3500 to pay off credit cards, and pay the smallest balances first. If you dip into your 401K at all, use it to pay off the credit cards ONLY. You’ll get a penalty, but this is what bankruptcy court will do for you, so why pay the fees and ruin your credit?

Also the worst thing you can do is sell your car while it’s “upside down”.