My wife and I ran out of money and used the last little bit of credit left on our credit cards this weekend for groceries. We will have to start going delinquent this week. We owe:
$90,000 in Credit Cards and other accounts.
$97,000 first mortgage (house might be worth $145,000, in any case we want to keep the house.)
$40,000 home equity loan (we have been paying interest only and have a balloon payment for the balance due June 2010.
$4,000 at $550.00 a month for 2 cars. Both cars are 6 years old but in excellent condition.
At this moment our FICO score is 671.
My wife is a commission only salesperson selling Resort Timesharing and has not had a sale in 7 weeks. The outlook for that business is not good. There have been several large bankruptcies recently and the companies that are left cannot get financing for this cash intensive business. She could be out of a job (not that it matters) any day.
I have recently (3.5 months) started an independent health insurance brokerage and in addition to our living expenses will need $2,000 a month to buy leads. The prospects for this business are very good and I have gotten back my start-up expenses ($3,000) and have shown a small profit (<$1,000). The business should give me a net income of $40,000 to $50,000 the first full year. Keep in mind that at this point there is no history of steady income.
Our immediate goal is to preserve what little cash will be coming in to live and grow my insurance business. We intend to hire an attorney this week. I have some general questions before I meet with the attorney.
1. I understand that the actual filing for bankruptcy will stop foreclosure proceedings. Should we contact the mortgage company and the bank which holds the line of credit on the house and tell them that we intend to stop making payments and are going to declare bankruptcy?
2. Once an attorney is hired can we refer our creditors to the attorney even if a filing date has not been determined?
3. What time lines will be important in order to preserve any income that we may have?
4. What am I forgetting about?
5. Our income for 2008 and 2007 will qualify for Chapter 7 as I understand the qualifications. Will our plan as described above work?
Any and all comments, suggestions, and advice will be appreciated. Ask any questions that you like and I will give whatever information that I have.
Thanks!
$90,000 in Credit Cards and other accounts.
$97,000 first mortgage (house might be worth $145,000, in any case we want to keep the house.)
$40,000 home equity loan (we have been paying interest only and have a balloon payment for the balance due June 2010.
$4,000 at $550.00 a month for 2 cars. Both cars are 6 years old but in excellent condition.
At this moment our FICO score is 671.
My wife is a commission only salesperson selling Resort Timesharing and has not had a sale in 7 weeks. The outlook for that business is not good. There have been several large bankruptcies recently and the companies that are left cannot get financing for this cash intensive business. She could be out of a job (not that it matters) any day.
I have recently (3.5 months) started an independent health insurance brokerage and in addition to our living expenses will need $2,000 a month to buy leads. The prospects for this business are very good and I have gotten back my start-up expenses ($3,000) and have shown a small profit (<$1,000). The business should give me a net income of $40,000 to $50,000 the first full year. Keep in mind that at this point there is no history of steady income.
Our immediate goal is to preserve what little cash will be coming in to live and grow my insurance business. We intend to hire an attorney this week. I have some general questions before I meet with the attorney.
1. I understand that the actual filing for bankruptcy will stop foreclosure proceedings. Should we contact the mortgage company and the bank which holds the line of credit on the house and tell them that we intend to stop making payments and are going to declare bankruptcy?
2. Once an attorney is hired can we refer our creditors to the attorney even if a filing date has not been determined?
3. What time lines will be important in order to preserve any income that we may have?
4. What am I forgetting about?
5. Our income for 2008 and 2007 will qualify for Chapter 7 as I understand the qualifications. Will our plan as described above work?
Any and all comments, suggestions, and advice will be appreciated. Ask any questions that you like and I will give whatever information that I have.
Thanks!
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