new to the site

[stressed07]

Ok I am taking the plunge and sharing my story because I am about to crazy worrying about this stuff...

My husband and I recently got married and both of us had been through a divorce and received substantial amounts of debt especially for our age
(26). I recently graduated law school and did not pass the bar so therefore I am making no income and I am retaking it this February. On top of that we are pregnant with our first babyl. My husband has two kids from a previous marriage, which we have a lot and support.

We are in the process of filing a Chapter 7 because total debt we owe is somewhere around $500,000 combined. The only things we want to reaffirm is the house, cars and business loan which is our livelihood.

I just want this to be over soon and get it filed and done. Originally I was not going to file and try to save my credit which was really good, but why now that were married what good does that do. My debt along is over $200,000 including student loans which is what I have lived off for the last 4 years. We make our necessary payments and that is it. The rest is just not getting paid and we get phone calls all the time. Now they are starting to call for me.

Someone please tell me we will survive this and the kids will be fine.

[HHM]

Could you roughly itemize your debt for us? i.e. how much is credit cards, student loans, house, car, etc.

However, you will survive this. The hardest part is getting ready to file for BK. Once you actually file, its practically down hill from there.

But I think you need to go in this with your eyes open and realize that more than likely you will NOT get the student loans discharged in BK. There are several posts around this forum (do a search) talking about student loan questions. But if you can give us more back ground, we can help point you in the right direction about what you should realistically expect to accomplish with the BK.

[BKTango]

First take a deep breath. It will all be okay. The kids, you, and your husband will be just fine. We have all been there. It's a hard reality check to know you have no way out of the mess you are in. Congrats on the baby and try not to put any strain upon yourself, I know that's hard but you need to do that.

Have you spoken with an attorney? If not I would suggest you set up 2-4 free consultations with some in your area to help you figure out where you stand in the bankruptcy world.

Keep in mind...student loans are not dischargable in bankruptcy unless you can prove that by paying them is putting undo hardship upon youself. However if you land in a Chapter 13 and I am not totally sure about this but payback to them might be included into your plan. Maybe someone who knows this for sure can chime in here and clarify that for you.

[stressed07]

Here is the debt:

Credit Cards: $75,000 roughly estimate
House that is in foreclosure $190,000
Repossed car $12,000 still owed after sold
Misc debt from business expenses $5000
House we live in $140,000
Cars $75,000
Business loan $50,000
Student loans $170,000

A lot of these are from divorce

[lrprn]

Rest assured that bankruptcy is most definitely surviveable and the kids will be fine. A fresh start is far preferable to years of bad credit, phone calls, and frustration not being able to stay on top of mounting debt.

Keep in mind...student loans are not dischargable in bankruptcy unless you can prove that by paying them is putting undo hardship upon youself. However if you land in a Chapter 13 and I am not totally sure about this but payback to them might be included into your plan. Maybe someone who knows this for sure can chime in here and clarify that for you.

Tango is right - although student loans are not secured, by law they cannot be discharged through bankruptcy unless both of you meet very stringent guidelines that people on permanent disability have trouble proving.

We have $21,000 in Parent Plus student loans from helping our son through college. When we were preparing to file Ch 13, we found out that whether you can continue to pay on student loans during bankruptcy or not depends a great deal on your trustee and the customs in your bankruptcy district.

Typically most lenders will want to put your student loans in forebearance during bankruptcy, but our lender told us the interest would continue to accumulate - this seems typical of other lenders as well. We were fortunate that our trustee is allowing us to make payments on the student loans during our bankruptcy, but the amount we were allowed will barely cover the monthly interest. For a good review of bankruptcy and student loans, visit the FinAid website at http://www.finaid.org/questions/bankruptcy.phtml

With two divorces and a house in foreclosure, you need a very experienced bankruptcy lawyer to help you sort out the many issues you are facing and make good choices for the future of your family. The best lawyer for you is not going to be the cheapest one! Since you have connections in the law field, ask several lawyers you trust which bankruptcy lawyers they would recommend (use the "for a friend/family member" excuse if you don't want them to know about your financial troubles). Make appointments with 3-4 lawyers if possible - most bk lawyers give free half-hour to hour initial consultations. You will learn a great deal about what your options will be.

Hang in there - there is light at the end of the tunnel. Come back with questions or just to vent on the worst days - that's why we're here!

[stressed07]

Yes we have spoken with an attorney and in the process of getting it filed see my husband began the process in July of 2006 and now that I have decided to file the attorney is just trying to change the paperwork to add me.