Prepare for the Inevitable?

[TumbleDown]

By the end of the year I will no longer be working. It is highly unlikely that I will be able to make any where near the income I make now.

As a result, I expect to not be able to meet obligations (mortgages x2, credit cards, etc.) by March 1, 2008.

We bought our house at the absolute height of market prices and now, if sold, our house would sell for $50k-$75k less than what we owe.

I will likely find work, but most likely at about 1/2 to 2/3rds (if I am lucky) of what I am making now.

I have read a lot of stories here and else where about softening the landing, or minimizing serious issues, by discussing with creditors the situation before missing payments.

Getting ahead of all of this is going to take a long while, maybe on order of years. If I am facing certain and absolute inability to pay the mortgages and credit cards, what are some suggestions to properly position myself for a softer landing and to begin again?

(I'll continue searching here as well. Good info!)

[bingo]

Getting ahead of all of this is going to take a long while, maybe on order of years. If I am facing certain and absolute inability to pay the mortgages and credit cards, what are some suggestions to properly position myself for a softer landing and to begin again?

First thing you do is get a job and get your living arrangements and transportation needs in order. Be sure you have a bank account and then, bk all the debt-including the house.

For damn sure, do not raid IRA's and 401K's to pay debts that will be discharged. ERISA qualfied retirement accounts are exempt from creditor seizure.

[TumbleDown]

Interesting.

My first impulse is to try and find a way to make it all work out and pay the debts even when there is a great deal of certainty that could never happen.

That is certainly why I ask. We know there will be damage. Big damage. We know we are going to have to learn a lot, including some counter-intuitive things, to properly position and manage this mess.

I suppose if I know we are facing certain and impending issues, that I need to consult now with a bk lawyer in order to properly prepare for that eventuality.

I am currently in MD. I have family that will allow us to live with them indefinitely in NC. How or does this complicate the bk process?

[bingo]

Interesting.

My first impulse is to try and find a way to make it all work out and pay the debts even when there is a great deal of certainty that could never happen.

That is certainly why I ask. We know there will be damage. Big damage. We know we are going to have to learn a lot, including some counter-intuitive things, to properly position and manage this mess.

I suppose if I know we are facing certain and impending issues, that I need to consult now with a bk lawyer in order to properly prepare for that eventuality.

I am currently in MD. I have family that will allow us to live with them indefinitely in NC. How or does this complicate the bk process?

Read the last sentence in your initial post and you'll see why I answered as I did.

First things first. Wether you file bk or not, you still have to support yourself. That's why I suggest finding a job ASAP.

Moving to NC will only be a factor if you have any assets to protect. You would have to reside in NC for 2 years in order to use NC exemptions.

[MadMonkey]

This post is not ment as an insult or dig.

You are one of the millions upon millions of Americans that are in the same boat.

What you have in your favor is you live in the greatest country in the world. Where you can start over with nothing and become wealthy beyound your wildiest dreams.

When I was kid in the 60's my dad was a high end exec in the Govt/Aerospace contracting. We had a brand new house, swimming pool, lived in a brand new community. Around 1967 my dad got laid off, as did 10,000 + other employees of the industry.

With three kids, a wife, two dogs, and mounting bills my dad went out and started painting houses, we had 14 Avocadoe trees in our yard that produced over 800 fruit each, every season, some the trees produced twice a year. My dad picked, and packed them into boxes and sold them to the local packing house. He started a pool cleaning route. 90% of the homes in the neighborhood I grew up in had pools. My mom who was French took a job at Berlitz and started teaching several days a week, nights, etc... My dad took odd jobs, he sold Amway. He did what ever he could to keep the house and the life style we were used too. He did that for about two years until he hired into another high end govt. job, which he ended up retiring from. When he passed away in 2001 he left my mom with an estate worth several million dollars.

The bottom line is you can survive if you put the effort into it. It takes hard work and dedication. You have to be willing to work two jobs, work nights, weekends,etc.... but it can be done.

When we were kids and ran into a problem we could not solve we would go ask my dad. His answer every time to us was, "Did you exhaust every possible solution you could think of to solve your problem. Why don't you go back and try it again, and then come back and see me." Funny thing is we would always figure out a solution to the problem.

That quote from my dad today holds true for me. I apply it every day.

I thought about filing BK in 2001 and realizied that I had not exhausted every possible solution.

So when you start to think how bad it will be, or I think we need to see an attorney and file BK, ask yourself;

"Have I exhausted every possible solution I could think of"

Let's face it immigrants both illegal and legal come into this country with nothing and within a few years live the American Dream. Look at who owns your local dry cleaning, or Chinese Restaurant, Liquor store, catering company etc....

It can be done in this Country, you just have to be willing to make it happen.

[TumbleDown]

MadMonkey, no offense taken.

Understand, I am facing an impending situation where the worst case, and unfortunately what seems to me to be the most likely case, is that I won't be able to pay my bills in about 2 months.

It is hard for me to predict if I will have work again to at least pay some bills or not.

As I educate myself, I am finding that I must make a decision about what I want to do and make that decision soon.

If I can get work (1, 2, 3 jobs) and eek by, I would do so. I made these obligations with the intent of meeting them, not avoiding them.

But the reality is that the job I am walking away from pays more than I can ever expect from any other job. My experience with any other company pays 1/2 or less than what I make now. I don't know if the details are important, but it is a strange circumstance and I guess I got lucky to get this job, but unlucky for who I got it with.

I want to pay my bills. I want to sell the house and find more suitable accommodations. I simply fear it won't work that way and I have to be smart at managing this decline and I have no experience and only a little research to go on.

I have learned a lot here and other places but at some point soon I have to assimilate that data into a decision process and put it into place.

I do appreciate your input!