Advice needed..possibly filing but am clueless

[brooke]

My husband and I have been considering bankruptcy for a while now and I think it may be time but I just don't want to make the wrong decision. I honestly don't even know how much debt we have but it is all pretty much in collections at this point except for our mortgage and our cars. We have never defaulted on our mortgage and we do have a good bit of equity but we can't touch it because of our terrible credit scores. We have had some late payments with our cars but have always paid and never had one repo'd.
We have tossed around the idea of sellign our house and using the profit to pay everything off but we don't know if that is the right thing to do. We have two small children and don't want to lose our home of we can help it. But the fact remains that we have a butt load of cc debt that we just can't pay. We have had some set backs in the past few years including my husband losing his job and an unexected pregnancy that ended up being high risk. Now I am at the point where I really need a new job with better hours for the kids but it would mean a huge pay cut which we can't afford.
This situation is causing me so much stress and I just don't know what to do. We are in PA if that matters and we do have about $40K in equity in our home. Would we even be able to file with that much equity and still keep our home? Does anyone think it would make more sense to sell the house and rent for a while? I'm just thinking that in this economy it might not be the best time to lose our home which we have decent payments and interest rates on from when our crdit was good.

[Brookamy]

I'm pretty new here myself so I don't have much advice for you. I just wanted to tell you that I know how stressful it is to be in debt and have to deal with the situation you are in. Good luck and I hope things work out.

[BassBoy]

If the info I found is current, then:

Homestead Pennsylvania Bankruptcy Exemptions
Exemptions are protected up to $8,725 per person in equity in your residence. However, you can't use these Pennsylvania bankruptcy exemptions to protect rental property or a home you do not live in.

With approximately $22,500 in non-exempt equity you may not be able to use the wildcard exemptions.
Wildcard Pennsylvania Bankruptcy Exemptions (Any Personal Property of Debtor)
You can protect up to $9,650 per person for any personal property that is important to you. However, your wild card Pennsylvania bankruptcy exemptions can not be used in addition to any property which you are also claiming Homestead Pennsylvania Bankruptcy Exemptions.

[cupcake]

The other thing to consider is that you may not have as much equity in your home as you think you do. I expected to have $25,000 to $30,000 equity in our marital home but turns out we may be upside down because of the recent drastic decline in home values.

[shabam]

It is probably a good idea to find out exactly how much you owe first. I would go to one of the credit agencies such as equifax and buy your credit report.

This will list all of your debts under your name and how much you owe. Probably a good idea to do the same for you husband. Within a few minutes you should have an idea of how much you guys owe. Keep in mind some of the same accounts such as joint accounts may be reported on both credit reports.

[Minnymouth]

Since you see yourself fixing to have major problems its time to get ORGANIZED.....

Gather up all your bills and find out just what you really do owe towards them....
Gather up your mortgages, car titles, deeds, etc. as your attorney will want to see them.
Call a realtor and get an estimated quote on what she would sell your home on the market for right now..... good estimate of what its worth!! (Don't pay for an appraisal, as a realtor can pretty well tell you anyways.

Separate your household bills and utilities from credit card bills.
Get totals on each.

See how much it actually costs for you to live where you do now..... can you still afford it, if all the little extra bills were GONE...

This is all information that an attorney would ask for anyways and you will need if you decide to file bankruptcy.

After you gather all this together, have a free consultation with 2-3 bankruptcy attorneys and see what options are basically open to you.

This will help you to understand what financial position your in right now and where you will be financially after filing for bankruptcy.

Just doing these things will take a lot of "pressure" off your stress and nerves. You will have a better understanding of everything involved.

Keep us posted if we can help......