filed chapter 7 and I feel like a complete failure at life....

[mgs2010]

I've been considering bankruptcy for quite some time--and finally in November I filed chapter 7. Just a little background info...I'm 23 years old and I owe roughly 38k on credit cards, I have a leased vehicle that I am surrendering and a car that I will be doing a "ride through" on instead on signing a reaffirmation agreement. I have about 70k in student loans....which is the main reason I filed--I'm aware that they wont be discharged but I recently finished school and my student loans are entering repayment...total monthly payment amount: 587.00 for 3 different loans (1 federal consolidation loan, 1 sallie mae private loan and 1 chase private loan) I make a somewhat decent salary for someone my age, approximately 34k/year. My car payments and credit card payments were out of control...I somehow managed to keep all my accounts current up until I filed. I had really good credit for awhile and had really good interest rates on most of my credit cards so when I tried to do consumer credit counseling I was told there wasn't anything they could do for me because my interest rates were lower than what they typically negotiate for with credit card companies. I looked into debt settlement plans but those seemed fishy and I don't like the idea of just letting things go and having my phone blow up with phone calls while I pay some random company a bunch of my money to "SAVE IT FOR ME"....I know filing bankruptcy is also letting things "go" but at least its a legal solution to my financial distress.

I can't help but feel like such a failure because I filed bankruptcy--I haven't had my 341 meeting yet but I'm really nervous about that, too. What will I say my reasoning is for filing? I f*#cked up big time and made too many impulse purchases? can anyone tell me a little about the meeting to help ease my troubled mind..

I'm just really scared. I feel like the trustee is going to call me out and make me feel like a huge loser because all my debts are credit cards and car loans, theres no medical bills--no collection accounts--no mortgage........I'm just a young man who made some really bad financial decisions and I feel like I'm going to stick out. Also, was it bad to file before being past due on any account? My credit report was clean as a whistle before i filed--never late on any account, ever. But once I learned what my student loan payments were going to be I realized there was just no way I could manage all of that debt...I will admit I made the decision to file pretty fast and didn't hesitate to do it after I met with an attorney..I think I needed the weight off my shoulders more so than anything else because my productivity at work was going down, I was depressed and constantly worried...getting little-to-no sleep at night...

Was it wrong of me to file? am I worrying for nothing?

sorry this was so long...I just needed to vent and I haven't had the guts to tell my friends or family yet :-(

[chasmith]

You are filing to get the fresh start provided by Bankruptcy.  This is legal, and some would say ethical.  What's critical is that you really change your habits and move on.  I was discharged a year ago, and I went through all the same feelings you have, I'm 59 and have fought through hard times before, but what the banks did with credit cards since 2006 was unprecedented - building a lending bubble then cutting availability and jacking rates.

The 341 is brief, and relatively private.  For mine there were probably 10 other people who filed bankruptcy in the room with their lawyers, so while I heard a number of other folks', and others heard mine, it was basically a five minute review of the file, a couple of questions that seemed aimed at whether I understood what my petition contained, and a "what happened" question.  For me it was "I borrowed what the banks offered, the market tanked, and my divorce settlement was too generous".  For you, I think your answer is in your post - "I'm just a young man who made some really bad financial decisions".

Stay with these forums.  Your credit scores can recover very quickly since you don't have derogs from before filing.  You will have to watch that you don't use the couple of credit cards you'll need to open as you can for rebuilding, don't use them except to keep them open.  Focus on building a savings reserve, put some money, even if just a little, into the 401K at work (try to capture employer match if there is one) or open an IRA to contribute to, and work to retire your student loans early.

Don't look back or second-guess yourself.  Take the fresh start, your whole life is ahead of you.

[divaesque130]

mgs2010,

I am 46 years old and I filed bankruptcy in 2003 and I felt exactly as you do, mostly because I believed since I was older I should not have gotten myself into that position.

With that being said, I agree with chasmith.  You will be getting a fresh start.  Stick with these forums and you will learn a wealth of information about credit that you may not have known, I did.  As far as your student loans, give them a call.  They may be able to lower your payments based upon your income.  It may take a little while longer to pay them off but you can always call back and make other arrangements when you are in a better financial information.  Pick your head up and look towards the future.  It will only get better.  Good Luck.

[MarineVietVet]

You made the best decision you could based on your unique situation. There is no right or wrong. Don't look back. You have to move forward now and be determined not to make the same mistakes that led to the BK.

I am neither ashamed nor proud of my BK. It's a part of my life but my past life. 

Don't second guess yourself. What's done is done.

From a BK years ago to:
EX - 9/09 pulled by lender 802, EQ - 10/10-813, TU - 10/10-774

"Some people spend an entire lifetime wondering if they've made a difference. The Marines don't have that problem".

[Creditaddict]

To answer your question about filing before anything was  late, I think that was the smartest thing you could have done.... wait till you see your score after BK, probably won't drop to much... I had a friend that carried his mortgage through the bk and discharged all the credit cards that he had never missed a payment, his score barely dropped below 700, while myself let everything go 3-4 months before filing, when I came out on the other end I was in high 400's!!!

After you are discharged I would look for 2-3 small credit cards and get in the habit of always paying them in full and in no time you will have your good scores again.

[Anonymous]

Im 30 yrs old.filed bk 7 in july09 discharged oct09. It was the best decision I ever made based on my situation at the time. I was$ 90k in debt majority from a second foreclosed mortgage n other irresponsible collections. I considered a fresh start. I learn a whole lot from this and now understand credit a lot better. I don't recall the exact scores at time of filing but do know where in the low 500s. Since then I've been able to obtain 3 cc and a year later s ores are EQ 636 TU 653 EX 640 fako. I felt the same way going thru the process ..but im glad I gave my family a chance for a fresh start. The 341 was quick n painless. Lasted only abt 5mins in front of the trustee n none of ny creditors showed up. IMO lenders will look at this in the future n realize that it was during the recession where a lot of us got in trouble. Good luck to u.