What would you do?

[momof5blessings]

DH is not willing to talk BK yet. However, since reading this forum, I've discovered that while they can't garnish his wages, they can freeze/take our bank accounts. His main, full time job does direct deposit, so I'm afraid they could take the money.

So far, we've only had one cc say they were turning us over to an attorney this month. DiscoverCard. The rest are just late.

This is what we have:

AT&T (Citibank) 16,462 - last pay 12/06 (hardship plan stopped)

AT&T (Citibank) 9,215 - last pay 2/07 (hardship plan stopped)

Bank One - Chase 5,635(CO) - 12/06 letter from Enhanced Recovery

BOA - 10,572 - last pay 01/07 (hardship plan stopped)

BOA -business 3,955 - last pay 10/06

Chase 18,748 - last pay 12/06 (hardship plan stopped)

Circuit City 1,077 - last pay 12/06

Discover - 6,512 (soon to CO) - last pay 10/06

Discover - 4,531 - last pay 2/07

Discover - 9,846 (CO threatening lawsuit) - last pay 06/06

MBNA (BOA) - 14,805 - last pay 02/07

Actually, after typing that out, we're not far behind on most.

We had several really good hardship plans, but we couldn't make it. We don't have any $$ left over. We had to depend on our side business, but that wasn't picking up. Unless the business picks up and his service work increases, we don't have any to pay on these debts. His regular full time job just pays the mortgage, HEL, car pmt and living expenses. We've cut back on pretty much everything we can.

DH wants to wait and not even discuss BK for a few more months to see how the service work is going to work out. He says there is potential for 500-1000 a week. He's an optimist and I'm the pessimist

So what would you do? If we do want to file, how would we find a BK attorney?

Thanks for the help!

[bingo]

That's just one hell of a lot of debt. Even at $1000 a week, you'll spend decades trying to work through that mess. I'd file and not look back.

If you don't know any attornies, pull out the yellow pages and look for lawyers who pratice bk law and get 3 or more consultations. Most wil give a free initial consultation. Might check and see if anyone from this organization is nearby:

http://www.nacba.com/

[thomassl]

If I were you, I would definitely consult a bankruptcy attorney! You have a tremendous amount of debt. The consultation is free and you can look up the Lawyer Referral Service or your local bar association in the phone book. It doesn't hurt to look at your prospects. In my case, I was injured on the job and suddenly my income was cut in half. These are those unforeseen occurrences in life that happen. Not being able to sleep at night because of not knowing how the bills were going to be bad was not doing my health any good. As I said, it doesn't hurt to talk to someone to see your options.

[AISLE4]

The total debt you've listed is about 100K. With the fees and high rates the debt balance is going to grow fast. You don't have money to settle the accounts. Bankruptcy is a financial tool you can use. A BK13 with this many creditors and this much debt would be a prolonged headache. Have you done much research on bankruptcy? Maybe you can qualify for a BK7? If you do decide that bankruptcy is the way to go, you can give it some time before taking action. Most of your debt is not very delinquent. Even if the creditors eventually start suing, that process takes time, and it can be awhile before they go after your money. If I were you I'd do some research and figure out if I'd qualify for a BK7. It sounds like you're just getting by with the money coming in right now. It might be a good idea if the husband doesn't try to bring in more money at this point. More money might move you from a BK7 to a BK13. A BK7 wipes out your debt and gives you a fresh start, albeit with damaged credit. Research the means test for your state and see where you stand.

[momof5blessings]

It is alot of overwhelming debt.

Here's the problem we have...

We built our home with our own sweat and blood. It's twice the house with twice the mortgage we throught we'd have. That's why we started the side business, to make the little extra we needed to get by. Then the business took off and we got lax about budgeting and saving, so when it took a nose dive, we got hurt. Our home is not finished (we've lived here 3 years now and it's missing most of the cosmetic and one bathroom) and sits in the middle of 8 acres. We're current on our mortgage (finally!) and we want to keep it that way.

When it was last appraised, we showed quite a bit of equity. However, the appraiser was trying to make it look good and since we have some of the finishing materials, he appraised it as if we had already done the work. The county assessed it at less than the mortgage. We do NOT want to lose the house. It's family property and our "forever home" I seriously doubt it would sell for what the appraiser priced it at.

I had researched BK some and it does appear that we would qualify for Ch 7, yet wouldn't they take anything they could sell to pay off the debts? DH has a ton of tools and I'm sure he couldn't claim them as all work related.

He's also concerned about finding a new job and having to show that he's declared BK.

I did research the means test. For our family size - we make less than the median income. There's also no way we could pay 25% of what we owe each month. If I go by the IRS numbers for a family our size, we are in the red for our living expenses. I'm thrifty and spend between 250-350/month on groceries for our family of 6 that still live here. I doubt we spend $100/year on clothing expenses.

I've already seen the balances go up a ton and we haven't charged anything in over a year. It's was a total of 80k not too long ago.

Will our house cause us problems? I know we need to have a consultation to know for sure, but I don't know if he'll agree to it yet, so I'm just trying to get a general idea of where we stand.

Thanks!

[bingo]

How much equity in the house?

[momof5blessings]

is hard to determine. According to the appraiser it would be almost 90K. (we owe 270k and he said it was worth about 360k)That was about 2 yrs ago and from what I understand, the market is not doing well here. No way we could actually get that. If we could, I'd be pressuring DH to sell so we could get rid of the debt and be free of it all.

The tax assessor says it's 20k less than our mortgage. I'd love to get a realtor out here to see what they would say. We're out in the country on 8 acres surrounded by trees. Most of the homes around here are around 100k. The appraiser had a very hard time getting comparables because there's such a variety of homes here. Most are mobile homes and much older brick, block, or wood homes. My in-laws live next door in a doublewide (on 6 acres) and I've often joked that they should buy our house and we could buy theirs. They complain about not building equity. In reality, that will never happen for MANY reasons.

In SC only 5k is exempt, but I'm not sure how that all works out in our situation.

I'm actually embarrassed to even discuss the value of our home. I'm a very simple person and never wanted a house like this. We overbuilt because we were doing it ourselves and saving so much money that we just kept adding things. Don't get me wrong, I LOVE this house and there are many good memories of when we were building.

[bingo]

Well, you need to get an accurate sense of the equity.

If it's much over $5K, your only recourse will be a Chapter 13 filing which may or may not work. One caveat in a 13-unsecured creditors must get at least what they would receive in a Chapter 7.

[momof5blessings]

So should we get it appraised through an appraiser or through a real estate agent?

How would the courts determine the value if we tried BK?

Thanks so much for your help.

[bingo]

It depends on the customary pratice in your district. Some will accept a witten appraisal from a realtor using neighborhood comps. Others, wil require a formal appraisal.

I'd get a real estate agent to come over and just get an informal estimate. That will give you a starting point.

[momof5blessings]

I'll see if I can get someone out here.

I really appreciate the help.

[LadynRed]

The fact that your house is unfinished will bring down the 'sell it now' price, which is what a Trustee would be looking at in a Ch 7 bankruptcy. Then you tack on the cost of selling it - and the equity goes down even more. You also have the HELOC, which takes away from any equity you have too.

The SC homestead exemptions have recently been increased an d I believe (have to find the recent article) that's now 50K EACH, which would make it 100K total.

You have over 100K in unsecured debt, that's a LOT of debt and as Bingo said, it would take you decades and a LOT more than 1,000/wk to bring that down. You only have 1 hint of a lawsuit from Discover. Believe me, Discover WILL sue you, they are vicious and play some nasty hardball.

You REALLY need to consult with a bankruptcy lawyer, BEFORE you are sued by Discover or any one else.

[momof5blessings]

Thanks for your advice LadynRed. My dh and I are discussing it now. He just got a bonus from work that will completely catch us up with our monthly expenses and pay some of our smaller one-time medical bills. Our "plan" is to whittle down the one-time bills - almost there - and then take any extra $$ from side jobs, etc, to start working on the CC bills.

He says if he looks too far into the future like I am, he would go crazy, like I am He says we have to just focus right now. I'm definitely the planner and he takes life one day at a time. I don't think I'll be able to convince him otherwise.

I guess it stops here for now. I have info that I just have to sit on. I tried to explain that to him that it doesn't look like we can pay everyone before they sue us. He's stewing on things now. We'll just see how it goes.

Thanks again!

[LNY]

Your husband's attitude is typical of people in denial. If they confront things, they have to deal with them... so they don't. Me, I'm like you. I'm not a "cross that bridge when you come to it" kinda gal--I can see the bridge up ahead, and I'm going to prepare for the crossing before I get there. Your husband is probably the type who waits at the bus stop for half an hour, THEN starts digging in his pocket for the fare when the bus comes. LOL

People like your husband allow themselves to be blindsided... and then end up having to make last-minute, desperate decisions. Remember that you have a say in this too. It's also your financial life... why is his the final word on the subject? Hasn't his head-in-the-sand way of doing things driven your family close enough to the brink as it is?

You came here for straight talk, so here's more: You two need to file for bankruptcy. Your situation is dire. And "his way" clearly has not worked.

[pjfan]

I agree with LNY. I would push the issue and File. The sooner you do it the sooner you can get on with your life. And start rebuilding. Only a year out of BK my husbands credit scores are going up! EQ is at 672!

Your husband's attitude is typical of people in denial. If they confront things, they have to deal with them... so they don't. Me, I'm like you. I'm not a "cross that bridge when you come to it" kinda gal--I can see the bridge up ahead, and I'm going to prepare for the crossing before I get there. Your husband is probably the type who waits at the bus stop for half an hour, THEN starts digging in his pocket for the fare when the bus comes. LOL

People like your husband allow themselves to be blindsided... and then end up having to make last-minute, desperate decisions. Remember that you have a say in this too. It's also your financial life... why is his the final word on the subject? Hasn't his head-in-the-sand way of doing things driven your family close enough to the brink as it is?

You came here for straight talk, so here's more: You two need to file for bankruptcy. Your situation is dire. And "his way" clearly has not worked.

[momof5blessings]

LNY, you've totally nailed my husband. However, so far, in our 22yrs of marriage, in alot of ways, he's been right more often than I have been. Don't tell him I said that

Also, whenever I push him on anything, it only makes him dig his heels in. He did admit to me that he has not ruled out BK. I agree with you all and believe we should at least consult with someone. He's not there yet. If I push him, he'll never be there.

Thanks again for taking time to reply.

[direred]

The only thing I'll add is that BK is for consumer goods, so if you could knock out that small business card (4k), that would probably help you from having to BK twice (personal and business).

[LNY]

LNY, you've totally nailed my husband. However, so far, in our 22yrs of marriage, in alot of ways, he's been right more often than I have been. Don't tell him I said that

Also, whenever I push him on anything, it only makes him dig his heels in. He did admit to me that he has not ruled out BK. I agree with you all and believe we should at least consult with someone. He's not there yet. If I push him, he'll never be there.

Thanks again for taking time to reply.

If you just let it go, he'll never be there either.

Try to find a grey area.

[momof5blessings]

DH has made an appointment to see a BK atty on Wed evening. The short version is that I can't live like this anymore and I was taking control of what I could. Almost half of what we have in unsecured debt is in my name alone. It's only a consultation, but it's a first step. I've worked it out to be able to go with him. Usually I have a very busy Wed evening, but I'm going with him. I've received an email from the atty with the info we need to bring.

Any other advice? My dh wanted to go alone and it's probably because I tend to talk too much. I'm mentally preparing myself to be quiet

One of the items on the list was either an appraisal or statement from the tax assessor's office. The appraisal was a few years ago and for alot more. Would it be acceptable to bring the most recent tax bill with the assessor's amount?

Thanks for your help. Fortunately, my DH loves me enough that when I got dead serious about how this was affecting me (without tears or tantrums) he took action.

[LNY]

DH has made an appointment to see a BK atty on Wed evening. The short version is that I can't live like this anymore and I was taking control of what I could. Almost half of what we have in unsecured debt is in my name alone. It's only a consultation, but it's a first step. I've worked it out to be able to go with him. Usually I have a very busy Wed evening, but I'm going with him. I've received an email from the atty with the info we need to bring.

Any other advice? My dh wanted to go alone and it's probably because I tend to talk too much. I'm mentally preparing myself to be quiet

One of the items on the list was either an appraisal or statement from the tax assessor's office. The appraisal was a few years ago and for alot more. Would it be acceptable to bring the most recent tax bill with the assessor's amount?

Thanks for your help. Fortunately, my DH loves me enough that when I got dead serious about how this was affecting me (without tears or tantrums) he took action.

No reason for you to be quiet. Just be calm... and honest, and thorough. That's the best advice I can give you.

You're doing the right thing. When it's all over, you'll look back and wish you'd done it sooner. I'm speaking from experience, because I also dragged it out until I was up against the wall.

And when it's finally over, remember you can always dispute off a lot of stuff. Bankruptcy is not a life sentence. I disputed mine off my TU after only 5 years. So chin up, girl! This is something you need to do, or you will have nothing but stress and misery for years to come... and just think what that will do to your marriage.

[LadynRed]

When it's all over, you'll look back and wish you'd done it sooner. I'm speaking from experience, because I also dragged it out until I was up against the wall.

Exactly the same for me ! You cannot imagine the relief I felt once I'd actually gotten off my duff and filed. I kept thinking I'd find a way out w/o filing for bankruptcy, but the hole only gets deeper if you don't have a LOT of money floating around to pay settlements. The relief was even greater once I got that discharge letter in my hands. I kicked myself later for waiting so long to file, I could have saved myself at least 3 years of stress !!

[momof5blessings]

I just hope it all works out. I do feel some relief, but there's also the concern that there may be glitches with some of the business expenses. I'll feel better after tomorrow.

LadynRed,

I seem to remember you were in Greenville at one time. If so, are you familiar with Skinner & Assoc on Beattie Pl. That's who DH made the appt. with.

[LadynRed]

I know of them, yes, but I wouldn't say I'm real familiar with them.