Discovering You are in Debt Can Humble You

[CoCoChanel]

I am so ashamed of myself. I have been working over 20yrs. I have a good job. I drive a nice car. I used to have money in the bank. I have a nice apartment. I live in a nice neighborhood in Louisiana, but today I discovered that I am in over my head. I have no idea why I never paid any attention to my debt. I guess I was spending, driving, working, living and throwing caution to the wind. I am not a young person so I should have know better, but I can not believe the shame I am experiencing. Its almost like a bad relationship.

Where did all the money go? When did my paycheck gets this small? Why do I only have 1.71 cents in my savings account? I am sitting down writing this, but my stomach is in knots trying to figure out what to do about the very first payment that I just missed paying because my check was not large enough. I simply ignored them when I could not pay them what they wanted. I always paid online for everything and now look at a mess I have gotten myself in. I remember when I first got a loan with Capital One. I really thought I was doing something by borrowing 10,000.00 to pay off some debt only to spend the majority of it paying and running out before even half was paid off. Now I owe them as well as the credit cards I should have paid.

How do we do this type of thing to ourselves knowing we will screw up eventually. I have got to fix this, I just have to but how?

[reallynervous]

Well, take a deep breath and know that you are not alone. There are plenty of us here who have had that same horrible moment of realization. Hugs to you.

I also was so ashamed when I realized we had reached a point where there was no way to turn it around. I still wonder why we weren't paying better attention. We had a lot going on w/ my dh having a major illness, but still, we should have been paying better attention so we could have acted sooner. We just kept going further into debt, charging living expenses and using paychecks just to pay the credit card/medical bills. We had never missed a payment on anything before, so we just did all we could to make the payments without looking at the overall picture. Finally, it all just came to a head.

It is also really hard to see how little we have to show for it all. Given our debt level, we should have so much more somewhere, but we don't.

Give yourself some time to deal with the realization. It really is the first step to realize the true extent of your debt. Keep reading here and learning so you will know what your options are. I am in awe of what a great group of people are here and willing to offer information and support.

I still feel ashamed and very disappointed in myself, but I know that I must move forward with this BK. I can't go back and change what has been done... only move forward to a new (and hopefully better) life for our family.

reallynervous

[CATCHMEIFYOUCAN]

We are all in the same boat with different problems and feelings. Look at me, I'm still a gambler. I blew all my creditors up from gambling. AND NOTHING TO SHOW FOR at my age ! But that is the past now, time to move on and make some changes. I'm still a gambler, I will admit, but now that I have no debts and no more cc's I'm much more careful. I just got done paying $6000 to the IRS from 2006 which I thought was going to take me many many many months if not a couple years. Now I'm working on paying off my car.
The people in here are very supportive so stick with the forum and you will get through this.

Best Wishes, Catchmeifyoucan

[Minnymouth]

It's amazing how you can paddle your can go along paddling your canoe and all of a sudden end up in the "rapids".....

Happens to the best planners...... and some are just plain victims of circumstances in their lives.....

Pull your credit report, see where you stand....... do a quick check list of expenses and income.... compare them.....

If you are in totally over your head its time to make some changes in your life....

Bankruptcy is not easy - in fact it's very embarrassing, nerve wrecking, and it REALLY MAKES US SEE THE LIGHT regarding our finances.....

Do a lot a reading here on the forum, ask questions, contact at least 3 attorneys (free consultations) and see what options are available in your situtation.

Talk to us, we can help mentally, emotionally, and with suggestions..... Vent all you like - we have all done it............... we have BIG SHOULDERS....

Keep in touch, Minny

[$$only4ever]

We,too, were "blindsided". As long as I made all of the monthly payments, then I thought that I was okay. Until I started paying the minimum payment so I could charge my groceries on a credit card. Then I knew I was in trouble. I was so embarrassed and ashamed when I filed, but I knew it was not a question of if I was going to file bankruptcy but when. That was over 2 years ago, and I have learned alot about myself and my spending habits. Once, you start having to pay cash for everything, it does give you a dose of reality. The nice thing though about paying cash is you never get a bill at the end of the month.

You are not alone. Everyone on this board has felt that way...Feel free to post at anytime. There is alot support here.....

[BKOnce]

Lessons learned. Life goes on.

[JRScott]

You're not alone. We've all traveled this path to some extent. We've let our stuff own us instead of us owning our stuff. We all come to the realization at some point that we're in trouble and that's the first real step.

It sounds like most of us you've gotten to far in. Time to step back and figure out where the money is going.

Take out a sheet of paper

At the top enter in how much you make each month.
Next list what you spend on food, utilities, mortgage/rent, car, taxes and insurance (car and medical). (separate line for each)

Look at what is left

Look at the credit cards/loans/other bills.

Compare their minimums to what you got left .

I'm suspecting that what remains to be paid is higher than what is available based on your post. Yep we've all done that .

The good news is you have realized there is a problem.

Depending on how bad the situation bankruptcy may be your only option. I know for me with unsecured debt over twice my yearly income that is the conclusion I came to. I fought the idea for a couple of years, which actually probably made my health even worse. In the end I succumbed and realized that yes I had to file bankruptcy.

If you decide that option is for you then you need to schedule some free appointments with local BK lawyers and get the feel for them. At the same time you'll want to stop paying anything but the necessities. If behind on mortgage or car payments because you've been paying the credit cards you'll want to get them up current. Also it is best to distance yourself at least 90 days from the last use of the Credit Card. Stop using the credit cards, best just to cut them up so you aren't tempted and live just from cash. If you don't have enough to buy something at this point you do without. Its hard and I know it is, but that's what we all have had to realize we need to do.

[CoCoChanel]

Thanks Guys...I really felt better after reading all that is here...

I have not felt this good in a long time. My blood pressure went up, I lost weight, believe it or not, my hair actually started growing which is weird because I thought it was supposed to fall out when you have nerve problems, but mines is doing the exact opposite. I felt so overwhelmed and lost....until I read all of you guys responses to me and mani felt better. I do not want to get ahead of myself because I have not filed yet. My situation is the legal aide fee for filing here is 299.99 dollars and I do not even have that. I got paid on friday of last week and could not pay at least 13 different credit cards and loans. When I kept up, I had no idea there was a problem, but just like someone mentioned....when I started making only minimum payments and then recently when I started missing one payment to pay someone else, I just kind of gave in and gave up and after listing all that I owe against my salary...I was in shock but I took a deep breath and got on here to ask for assistance from you guys. I must admit I read first before posting because I was scared.

1. I got my 13 credit cards and personal loans that have not heard from me at all in one month(behind on all 13 payments by one month)
2. paid my car note, paid my rent, paid my light, paid my phone, paid my car insurance and bought groceries. Almost did not have enough for gas to get to work, but manage to get some money some how.
3. Have been reading all the books I can get my hands on about Chapter 7.
4. Have not contact any lawyers yet because I was going to go pro se(file myself because I can not afford a lawyer.
5. Trying to find paralegal because I heard one of you mention you used one to assist.
6. Worry has started about wether I will get a wage assignment. Heard that employers can fire you if you get more than one.
7. Trying to file Chapter 7 before any of the law suits or wage assignments start and looking for information on how to prevent this.

I am just going to keep reading, keep posting and keep asking for assistance so I can help myself. If any of you have anymore advice for me....because I intend to do this myself, let me know. I really literally am starting right at this moment with getting my credit reports, documenting my household expenses and living expenses and keeping my check stubs. I am sure even the Bankruptcy Help Desk here where I live who helps people file when they can not afford a lawyer will need this information. Also I heard I need to go to credit and debt counseling. Is this true and if so, is this supposed to be done before you file?

[JRScott]

Try not to worry, if you've missed only one payment then they aren't going to wage garnish you. Probably take most of them 6 months or longer to seek judgments. So you got time.

Some items you will need:

1. Tax Returns for this year and last two years.
2. Check stubs for the 6 months proceeding your filing.
3. A Neat stack of all debt papers. Preferably out of the envelopes in a nice neat orderly stack.
4. Obtain a Credit Report from each of the 3 Credit Reporting Agencies.
5. Obtain an estimate of the value of your car. You can use Kelly Bluebook or NADA for car pricing.
6. Since your renting I'm assuming you have no equity in any land.
7. Make a list of expenses and income (you'll need to fill out papers....make sure not to forget things like taxes, inspections, etc)
8. You do need to do a Credit Counseling Session with an approved provider for your area. You can generally go to the courts webpage and look up who is approved.
9. You need to know the value of any 401k or other retirement accounts.
10. You need to know if you have done any insider trades in the last year. (That's where you gave or sold property to a family member, friend, etc).
11. If you pay tithing or other donations to your local church or other charity you need to get a list of how much you've paid for the last year (I think).
12. They'll also want any records of property transfers if any in the last 4 to 5 years.

That's the things off the top of my head that you need to start gathering up. Take your time don't rush, if you don't have the pay stubs then ask your work to print you copies.

Still remember you've got time to get this all ready before they take action, they'll start calling and annoying you but won't do much else. Do not tell them you are going to file until you have done so. It is helpful in this time to have caller ID and then block calls that choose not to show their ID. Another useful tool is to get an answering machine and let it pick up all calls. Make sure that you have your name stated clearly so they can hear it, this way they won't call others.

[CoCoChanel]

I did not know creditors called others.....

My daughter refuses to answer the phone if its not for her. My friends are mostly law enforcement people and believe me, they ain,t telling nobody nothing about nobody...but I am still surprised that they start calling others. Thats deep.

[JRScott]

It depends who you listed as references if any when applying. But if you listed some then yes they'll call them. Some will also try calling your work. However if you have an answering machine that clearly identifies they have called the right number then generally they will just call you