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Sorry to hear about you are going through. I'm slowly going through the same thing at the moment. Every moment is intense and hurtful. If you're going to file, you need to be wary of financial habits the same and pay no debts. In other words; no large purchases for 3 months, no selling large amounts of property not paying debts etc. You also should 100% contact a lawyer. Do not be too afraid, bankruptcy is not the end of the world. I am slowly accepting this too. Once you file, it will be a you 2.0 (a better, leaner) you.
I know that this is a tough time for you and hubbs. No worries. The relief from creditor calls alone makes it worth it. Unless you expect a tax refund to pay off all of your debt or pay down to an amount that you can comfortably pay (not struggling to meet or always late), stop the hemorrhage, pull the trigger and file. You will need an attorney, preferably one that specializes in bankruptcy and after a small down payment, the rest of the fee will be folded into bankruptcy if you get a decent one. Save your refund for after bankruptcy when you face little to no credit and high interest rates. There is life after bankruptcy. Fortunately, rebuild starts immediately after discharge but takes time. After discharge, just go slow and learn you cant always get what you want when you want it. If you cant pay cash or pay off purchase within 2 mos, dont buy it, save for it instead to keep your credit/interest burdens light. Credit isnt free money and the process is a marathon, not a sprint. Use it when necessary not when convenient. Good luck.
Sorry to hear of your troubles. Your story sounds very similar to mine & my DW. I lost my business and my house of 16 years. I do not mean this to sound harsh, but rather as a wake up call- you DID do this to yourselves, but you also have the power to change things. Contact an Attorney ASAP and get the BK started. Don’t be embarrassed; it is a business decision, plain & simple. BK no longer carries the stigma it once did. I felt a total failure after losing my house, trust me.
What you DO need to do is learn how to control your spending habits, otherwise you will fall behind again. I did, so I speak from experience. What has worked for me is making a budget & sticking to it every paycheck. I made a very simple Excel spreadsheet and listed EVERY SINGLE OBLIGATION (rent/mortgage, all utilities such as electricity, gas, water, cable, phones, including mobile, any other credit card obligations, medical bills, etc). This was the only way I could get a handle on my spending and see where the money was actually going every paycheck. I then put my net pay at the top of each 2 week pay cycle & allocated funds to each obligation, even if that obligation is paid once a month. The big benefit was being able to visually see how much I had leftover after every obligation had been taken care of, and not spending more than that on frivolous things. As I paid off post-BK debt, I’ve seen my available cash flow grow, and it still is growing! It was very humbling seeing what we had done to ourselves, but it is also very satisfying knowing that we have the ability to dig ourselves out and right our credit ship. I can send you my budget template if you like, just send me a PM. Good luck to you and keep us posted!
Template sent. Check your mail. Below the "Extra" row you can put everything you spend that isnt allocated. It's basically a check register.
One thing I forgot to say is, one item you NEED to put down every paycheck is yourself. EVERY paycheck, pay yourself something to put in savings, even if it is only $20. As you clear up debt and have extra cash flow you can put more aside each paycheck. Before you know it you will have a savings for unexpected expenses that won't blow your budget out of the water, like car repairs, tires, etc.
Practice delayed gratification- that was the hardest part for me to get used to. If you put everything you buy down on this budget sheet you will be amazed at what you are spending money on & where you can save (eating out was a killer for the DW & I). Keep us posted!
Suzie,
Difficult decision you have to make here. Assuming you are up-to-date on your mortgage payments (you are probably negative on your equity in your house which is GOOD, if you are trying to keep it through a CH7 or 13) and you are no worse than -30 days late on ALL accounts you have on your CR, Bankruptcy is not a bad option to take.
I didnt take the time to read other comments on your thread, as I am guessing someone has already told you what the steps are to take to get the bankruptcy started (BK attorney, fees, paperwork needed, creditor meeting, TWO credit counselings, etc). However I will edit this post if someone has not mentioned the steps and give you a quick synopsis.
I dont know where your credit stands at the moment, but expect to get a hit of at LEAST 40+ points on each of your CR...maybe even up to 150 points if your credit was pretty decent. I personally had horrible scores to begin with as I got into a real funk back in 2015 where I got extremely careless with my finances so the BK actually IMPROVED my scores (to my surprise).
The bankruptcy in itself should not last longer than 90 days (unless you amend it and add paperwork that perhaps you missed with the initial submission with your attorney). With that said, give your attorney ANYTHING and EVERYTHING so as to not hide assets or whatnot, because the bankruptcy trustee will put you under oath at the creditors meeting (dont be that person!).
The best time to do a bankruptcy, if you get tax refunds yearly, is 90+ days AFTER you receive a refund. This is because the trustee can go as far back as 90 days when you meet with them to REPO your tax refund. Once that meeting happens (around the 6 week mark) and the trustee gives you the thumbs up, you are SMOOTH SAILING from there.
I did my discharge in June (had 95k in debt), completed in September and I started to app the last few weeks and have only been turned down once (by a bank that I burned in BK). I have been using the pre-qual advice that I have read up on here and it works pretty well so I had a good idea if I were to be declined or what not before submitting.
Good luck in your endeavors, whichever decision you choose. Feel free to contact me at anytime!
-Ricardo
Thank you very much for replying! It helps us so much to hear an advice or been there done that stories from others. I honestly don't think we can wait until after tax season at this point. We are just too deep in a hole. Right now only two cards are late by about two weeks, but time is definitely ticking so by the time we file we will have a large amount of accounts behind and that scares me to death. But we can't pay them. My husbands income took a plunge over the past couple months (through no fault of his own) and we just didn't realize how quickly things would turn south for us. We have a ton of paperwork to get together for the lawyer and then we have to schedule our consultation once we get all that prepared. My credit is not so hot right now. It has gone down assuming just bc of the credit card usage going up and only paying minimums to get by. My husband's credit is actually still pretty decent. We have never been more than like a week late on anything up until now. Mortgage and car payments have all been paid within the grace periods. Not always right on the due date but never later than within the grace period. I'm assuming that is ok? We do want to keep our house and two car payments for sure. Little to no equity in the house and cars so I don't see that being a problem.