Will try to keep this short 
We're filing Chapter 7 in about two weeks, after going through a year and 1/2 of financial hell. Here's our background:
My husband lost his high paying job in September, 2009. After an entire year of searching for a new job, he finally was offered a position which paid less than half of his previous salaries. I work as an independent contractor, and make about $36,000 in straight commission per year before taxes and expenses, with no set payment schedule (which leaves us with... not much). I have no 401K and nothing in savings.
While my husband was laid off, we completely tapped his 401k just to stay on top of the bills and the mortgage, there is nothing left. We managed to pay all bills/mortgage until July of 2010, at which time we saw no way to keep up, and missed our first mortgage payment (continued to pay the credit card bills and all others). In Sept 2010 we received a forebearance from the mortgage company to pay just $500 a month until January, 2011. We just made it.
We met with an excellent bankruptcy attorney in December, 2010 after realizing there was no way we could get out from under this debt, and no way we could continue to pay the mortgage. Mortgage is in husbands name only, deed too. We knew we were headed toward foreclosure. It was decided that my husband would file Chapter 7, to hopefully discharge his CC debts.
We continued to pay my cc bills and one personal loan payment, had not missed one payment, with the thought that we would keep my credit spotless, it was a struggle but we somehow managed.
In December, after meeting with the attorney, we decided that keeping a roof over our family's head was our main concern. We simply could NOT lose the house as we would have nowhere else to go, and I would not qualify for any smaller mortgage on my own (we tried). We were approved for the federal loan modification through our mortgage company, which reduced our mortgage by $600 per month. OK, we could make this payment, IF we didn't have CC bills. The decision had to be made to stop paying his CC bills in order to have a home to live in. Mine are paid up to date as of now. Mortgage is now up to date and he just signed the final paperwork for the modification, which becomes official this month.
In January, we gave back a car, which was solely in my husbands name, explaining to the bank that we could no longer make the payment. They auctioned it, with a remaining balance due of $1800, which they are now threatening to sue us for.
We have virtually no assets except an old boat which was appraised independently for $4500. No equity in the house whatsoever, and nothing else of value. My husband has one car in his name, it's worth approx what he owes on it, no equity there either. We want to keep the old boat, it is currently the only source of enjoyment in our foreseeable future, even though it may be next year before we can actually use it again.
Here's where it gets a little complicated, and where I have questions, because I'm thrown for a loop:
At our last meeting with the attorney, we went through our entire household income vs. expenses, honestly, and with a fine tooth comb. After taking a very good look at things, the attorney asked point blank "I don't understand why you're not filing a joint bankruptcy case, you clearly don't make enough to live on after paying your (meaning mine) CC bills and the personal loan.". He's right. It's a daily struggle for us, and we continue to scramble to pay the bills, only by the grace of God have we managed to hang on still. I told him it was because we were trying to keep my credit spotless (current score about 780+). To which he said WHY, and I had no good answer. I don't need spotless credit, and it won't stay that way for long anyway because we cannot continue to stay on top of it. If we need something in the future we will pay CASH for it, or not have it.
OK, so in two weeks we are filing a joint case. But up until now I had NO intention of filing, and have used my CC cards for expenses to the tune of about $5000 since October (car repairs, tires, groceries, household goods, a trip for my husband which was required by work for training, general living expenses, clothing for my growing kids, etc..). I've also made payments on this card, and am up to date. With my CC payment and loan payment included in the monthly expenses, we clearly pass the "means" test.
So I'm freaking out just a little bit. Husband hasn't used CC cards since October 2010, and also hasn't made any payments since Dec 2010. But I HAVE, and frankly, I'm not certain what this will mean. The attorney said that most likely they won't discharge all of my debt and we will be responsible for some portion of it.
Will the Trustee understand that I wasn't planning on filing until we actually sat down and realized that we couldn't continue to live on what we make and still make these payments? We've been in "band aid" mode for about a year now, just scrambling to pay these bills and keep my credit score high.
I feel like my husband had a solid chap 7 case, and had been working toward filing for months. Now I'm concerned that because I'm filing too, I don't know what this will mean for us. I clearly ran up more debt these past 6 months, and we paid all of MY cc bills but not his, and I'm sure the trustee won't like that.
We thought about waiting to file for a few months, but the stress of this is really getting to both of us. Plus, we don't want to get sued/garnished for the returned car. I would prefer to go ahead and file in two weeks. Any thoughts on that?
Any advice or info you could share would be appreciated. I'm really worried about the 341 meeting and want to feel that I'm not rushing into this blind. However, I do believe that even if my husband were the only one to file now, unless our financial situation changed drastically (don't see that happening), that I would most likely have to file this year as well. We simply cannot continue to stay on top of these bills any longer, time is up. We may as well file jointly now, even though the trustee will clearly take issue with my past 6 month credit history. Right???
So much for keeping this short. Sorry.
Thanks
We're filing Chapter 7 in about two weeks, after going through a year and 1/2 of financial hell. Here's our background:My husband lost his high paying job in September, 2009. After an entire year of searching for a new job, he finally was offered a position which paid less than half of his previous salaries. I work as an independent contractor, and make about $36,000 in straight commission per year before taxes and expenses, with no set payment schedule (which leaves us with... not much). I have no 401K and nothing in savings.
While my husband was laid off, we completely tapped his 401k just to stay on top of the bills and the mortgage, there is nothing left. We managed to pay all bills/mortgage until July of 2010, at which time we saw no way to keep up, and missed our first mortgage payment (continued to pay the credit card bills and all others). In Sept 2010 we received a forebearance from the mortgage company to pay just $500 a month until January, 2011. We just made it.
We met with an excellent bankruptcy attorney in December, 2010 after realizing there was no way we could get out from under this debt, and no way we could continue to pay the mortgage. Mortgage is in husbands name only, deed too. We knew we were headed toward foreclosure. It was decided that my husband would file Chapter 7, to hopefully discharge his CC debts.
We continued to pay my cc bills and one personal loan payment, had not missed one payment, with the thought that we would keep my credit spotless, it was a struggle but we somehow managed.
In December, after meeting with the attorney, we decided that keeping a roof over our family's head was our main concern. We simply could NOT lose the house as we would have nowhere else to go, and I would not qualify for any smaller mortgage on my own (we tried). We were approved for the federal loan modification through our mortgage company, which reduced our mortgage by $600 per month. OK, we could make this payment, IF we didn't have CC bills. The decision had to be made to stop paying his CC bills in order to have a home to live in. Mine are paid up to date as of now. Mortgage is now up to date and he just signed the final paperwork for the modification, which becomes official this month.
In January, we gave back a car, which was solely in my husbands name, explaining to the bank that we could no longer make the payment. They auctioned it, with a remaining balance due of $1800, which they are now threatening to sue us for.
We have virtually no assets except an old boat which was appraised independently for $4500. No equity in the house whatsoever, and nothing else of value. My husband has one car in his name, it's worth approx what he owes on it, no equity there either. We want to keep the old boat, it is currently the only source of enjoyment in our foreseeable future, even though it may be next year before we can actually use it again.
Here's where it gets a little complicated, and where I have questions, because I'm thrown for a loop:
At our last meeting with the attorney, we went through our entire household income vs. expenses, honestly, and with a fine tooth comb. After taking a very good look at things, the attorney asked point blank "I don't understand why you're not filing a joint bankruptcy case, you clearly don't make enough to live on after paying your (meaning mine) CC bills and the personal loan.". He's right. It's a daily struggle for us, and we continue to scramble to pay the bills, only by the grace of God have we managed to hang on still. I told him it was because we were trying to keep my credit spotless (current score about 780+). To which he said WHY, and I had no good answer. I don't need spotless credit, and it won't stay that way for long anyway because we cannot continue to stay on top of it. If we need something in the future we will pay CASH for it, or not have it.
OK, so in two weeks we are filing a joint case. But up until now I had NO intention of filing, and have used my CC cards for expenses to the tune of about $5000 since October (car repairs, tires, groceries, household goods, a trip for my husband which was required by work for training, general living expenses, clothing for my growing kids, etc..). I've also made payments on this card, and am up to date. With my CC payment and loan payment included in the monthly expenses, we clearly pass the "means" test.
So I'm freaking out just a little bit. Husband hasn't used CC cards since October 2010, and also hasn't made any payments since Dec 2010. But I HAVE, and frankly, I'm not certain what this will mean. The attorney said that most likely they won't discharge all of my debt and we will be responsible for some portion of it.
Will the Trustee understand that I wasn't planning on filing until we actually sat down and realized that we couldn't continue to live on what we make and still make these payments? We've been in "band aid" mode for about a year now, just scrambling to pay these bills and keep my credit score high.
I feel like my husband had a solid chap 7 case, and had been working toward filing for months. Now I'm concerned that because I'm filing too, I don't know what this will mean for us. I clearly ran up more debt these past 6 months, and we paid all of MY cc bills but not his, and I'm sure the trustee won't like that.
We thought about waiting to file for a few months, but the stress of this is really getting to both of us. Plus, we don't want to get sued/garnished for the returned car. I would prefer to go ahead and file in two weeks. Any thoughts on that?
Any advice or info you could share would be appreciated. I'm really worried about the 341 meeting and want to feel that I'm not rushing into this blind. However, I do believe that even if my husband were the only one to file now, unless our financial situation changed drastically (don't see that happening), that I would most likely have to file this year as well. We simply cannot continue to stay on top of these bills any longer, time is up. We may as well file jointly now, even though the trustee will clearly take issue with my past 6 month credit history. Right???
So much for keeping this short. Sorry.
Thanks
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