Bankruptcy - Deep Gap,NC

We haven't, we have zero credit card debt, it's all student loans and there is no way out of that but to suffer and pay them back.

But, my best friend did. It helped them a lot. They did not lose their home or cars. The bad thing though, is they did not change their spending habits or increase their income and now they are back in the same position almost 3 years later. Many people need the release, medical expenses, death, divorce, prolonged unemployment... but if it is a lack of planning and spoor spending habits, that needs to be remedied otherwise you will only have the same issues later on. So, it really just depends on why you are filing for bankruptcy. In any case, I wish you all the best of luck. Looming debt is a nightmare.

Others have given you great advice. I'll just add my personal story. After my daughter's long illness, we were over 250K in debt. Most of it medical bills, but a good chunk credit cards that we used for hotels, meals, medical supplies and medicine while she was in the hospital and recovering. Along with medicine that she had to take daily and still does. Sooooo... we filed and were able to keep anything we wanted, we just had to keep paying on whatever we wanted to keep. You just exclude that from the bankruptcy. We were renting at the time, but we did turn back a car and a jet ski.

Now, we've been able to finance a new car and a home with a fixed rate FHA mortgage. Our biggest issue is that we have chosen not to get credit cards because the interest rate is insane for people with a bankruptcy. We COULD find ourselves in a sticky situation if we ever had to do a large auto or home repair. But so far, we've managed and have a good sized cushion in savings for emergencies.

Honestly, there was absolutely no way we could have ever gotten out of our situation. It is embarrassing, yes, and it continues to be embarrasing 7 years later, but it is what it is, and it saved our sanity.

We had to do it. We did not lose anything except our bills (doctor) and our credit. You have it on your credit for 10 years but it only affects things for about 2 years. We bought a house 2 years after we filed. We also bought 2 used cars. Our interest rate was slightly higher for the cars. We don't use credit for anything else, so we don't ever notice any difference in our lives.

I recommend it for anyone to get back on track.

Yep. Best choice, period.

There are 2 types; Ch7 & Ch13

If you're even THINKING of consolidating, don't. CH13 is exactly like consolidating but better. Because it's

1) WITH legal protection (if you lose your job, end up in the hospital, whatever... it puts your payments ON HOLD until you have income again, instead of consolidating which (for any reason) you can't make a payment puts all your debt right back on you with interest and aprs through the roof.

2) It's off your credit report in LESS time

3) It takes into account what your expenses are (and not just survive expenses likechildcare and food, but also living expenses like retirement accounts and entertainment). The courts via your attorney figure out what you can ACTUALLY afford to pay living responsibly, and that's what you pay. Consolidating your debt is paid first, and you have to scrape by on what's left. 13 maps out responsible living (bills, insurance, retirement, childcare, savings, car repairs, medical expenses, entertainment, retirement, child support, etc.) and what's LEFT is what goes toward your plan.

4) During the process ALL your creditors are notified, and once the judgement comes in no one can "add" onto your debt (if they don't raise their hands as being owed and what the amounts are, they aren't included, and the debt is wiped), existing creditors cannot decide you owe more, no APRs changing, or people opting out. What the courts say you pay, you pay. There are NO surprises.

5) You only pay for a set number of years based on what you can afford. Consolidation is 5 years and needs to include everything. Ch13 is 1 year, 3 years, etc on up to 5... but most people in 13 do 3 year plans.

Unlike Ch7... you can keep your assets (like your primary residence, cars, etc.). There are dollar and number limits... for example, if you own 3 cars and there are only 2 driving adults (a driving teen would change the numbers if it's their car, for example allowing an extra car, or if you're a single person filing) you may need to sell one car... but it depends on their value.

Which is better for you Ch7 or Ch13 depends MOSTLY on what assets you possess, but there are other factors as well. Only your attorney is going to know which is the best choice for you. To know... if you file ch13, it's more expensive BUT your lawyer fees are PART of your settlement.

My best friend and her husband filed for Bankruptcy 2 years ago.

they did NOT lose their home.
they did NOT lose their cars.

They DID have to come up with the $1,500 to file for bankruptcy. It was a GREAT choice for them. She had been unemployed for almost 9 months...they got rid of everything that was not necessary..we're talking bare bones...and borrowed money from family and friends to keep the car payments current so she could get to job interviews. The car is now paid off or will be in the next three months.

They have been able to refinance their home and have learned to live within their means...not that they were doing it before...but being unemployed for almost a year will put a dent in your life! :)

if you do this - get it all - every last penny you owe together - leave NOTHING undone. You can get the car and house set aside...I'm sorry I don't remember what the term was but this was her stressor as well - she didn't want to lose the house and the car.

They went in front of a judge, told the judge why they were seeking bankruptcy..he asked a few questions and then he said granted....

within six months of the bankruptcy - they were getting letters and such in the mail for credit cards...all they have torn up....please do the same.

We were forced into bankruptcy by a crooked accountant who had us owing the IRS five times more than we'll ever earn in a lifetime for the years 2005 and 2006. Dont' ask me what the hell happened or what my husband signed or why I filed jointly as the spouse of a musician, I honestly can't explain the nightmare that ensued.

While we went practically bust sending beefy monthly IRS OIC payments and paying lawyers to help us prove we couldn't pay the full amount because we had never earned, oh I dont' know, MILLIONS OF DOLLARS,(all proof documenting that we had never earned it was futile by the way the IRS never once reviewed our materials I found out later...) for YEARS, we maxed out a credit card for the first time in our lives on living expenses while we paid medical debt (3 out of pocket deliveries) and IRS OIC payments with our income.

In the end, the legal battle was futile, we still had our IRS balance PLUS INTEREST due. The balance was so huge, our debilitating payments didn't put a dent in the interest. Anyway, we weren't even sure we would ditch the IRS debt by filing (the laws on taxes are very vague, and taxes must be over 3 years old to include, and even then may not be discharged), but we simply had to file to due to other debts at that point, we couldn't stay afloat.

No, we did not lose our house. We had almost no equity on it, so no one would take it. We knew going into it that we would not lose it, and stayed current with our mortgage. (TALK TO A LAWYER, and PAY a consultation fee, the ones who give free consultations are NOT thorough. Sit and go through EVERYTHING with the lawyer, the fee is so worth it, he will tell you what you will get, and what you will lose.) As a perk, we were forced to list the house as a debt, so even though we are current on it and have no intention of leaving it, we are now under no obligation to pay the mortgage and could walk away if we wanted.

The house was all we had. Our shared paid off car wasnt' worth taking. No investments, savings, other properties, etc. Our income showed there was nothing to be gained (the only ones not "getting that" were the IRS) from us in a 13, so we got a chapter 7, total debt discharge. My husband was bummed we paid all our medical bills, since they would have been discharged too.

Your situation depends on your assets, income, etc. Only your lawyer can tell you if you will lose your house. Our bankruptcy was a pain in the neck between the fee (borrowed) and initial paperwork, and then waiting 60 days to see if anyone contests your filing (they usually don't apparently) but hey, at least we could do it, and we lost "nothing" since we had "nothing". We have no credit cards now, but we never depended on them before (before IRS sucked every penny we earned for 4 years) and haven't bothered to get new ones. It's AWESOME not to have the huge card payment we used to, but still not enough to get health insurance or change life much. But yes, in our case it was worth it and the only thing we could do. We're finally living normally again. We were always frugal, but now with some debt relief, we feel the lighter weight for sure.

We did get lucky and lost the IRS debt as far as I know (haven't actually had the nerve to call, but the scary notices have stopped)
Talk to a lawyer, and good luck!

My ex-husband and I did. We had one car that was leased and we let them have it back because it was a lemon. We got NO student loans cancelled.They are exempt. We got all bills and credit cards cancelled.
We tried to keep one but the judge said no it is ALL of them.

Afterwards, we could get a gas card at 26% interest for car repairs and gas. We only used it for emergencies. We were made to give a big deposit on a crappy apartment.

Emotionally, I was all worried. One creditor asked us why we repaired our car on credit.Didn't we know we were going to take bankruptcy? Well, we didn't.
We went to credit counseling and she told us we had no choice. Of course,
we did. My husband could have taken a second job for six months. our bills totaled under $12000. plus, he had retirement accounts worth $60,000 which we could have used as well. In our case,it was wrong to take it, but at 20 I was listening to others.

The weirdest thing is it never showed up on my credit report, only his. After paying off student loans for 10 years on time, I could get a mortgage at 3.65% if I wanted it now. Emotionally I felt like a failure for awhile. I did what the lawyer said. I only spent money I had to and never went into debt on unnecessary things. I ran up medical bills, but I paid them off.

now, it really wasn't so scary or bad. i had been told horror stories but they didn't come true for us. it is very hard to take bankruptcy. we had to come up with thousands before we could file. how did we do it?the lawyer told us to quit paying the bills.

I did it. The emotional stress and the feeling like a "failure" was by far the worst part. But you get over it.

I realized, I was like a lot of Americans. Went to college, got a degree, got a good job, bought a condo when the market was good (but within my means with my paychecks) and then was out of work for 2 years. When you're out of work AND the housing market crashes so you can't sell your home--you get screwed. And the bills mount up and you can't pay them even though you're looking for work. And the credit card balances go up because you have to buy things like groceries and gas (to get to the measly part-time jobs you're able to scrape up that don't quite cover everything).

It's been a year. I have one credit card again and the interest rate isn't too bad. I kept my house and my car and ditched the credit card debt that would have taken me at least 10 years to pay back anyway (at the current rate of money we are making). Instead of putting EVERY extra penny for the next 10 years into credit card debt and scraping by, I chose to take the bankruptcy hit for 10 years and now our extra pennies go to things like saving for my daughter's college (which she will be attending in 10 years!)

College for my daughter or bankruptcy? I took the emotional hit and chose bankruptcy. Bankruptcy won't matter to me in 10 years but her going to school will!

Good luck!

Sorry this is long, if you don't want to read about our experience oflosing everything due to job loss then just skip on to the next answer. I do go on and on about stuff sometime.

We did credit counseling and everything we could do to lower our debt.

Anyone who thinks deciding to file bankruptcy is cheating or lying just hasn't been in the position to have to consider it yet. We had a good life, 2 new cars, a nice house, several credit cards with not a lot on them, could go on fun vacations, we could eat steak every night if we wanted to and did when the missionaries from church would come eat with us, we weren't making tons of money but enough. He brought home about $1800 per month after the bills were taken out of his check through the credit union.

He out of a job out of the blue. It was retribution for a safety violation my hubby turned his engineer in on. The pilot plant needed to fix this issue but the engineer over it didn't want to stop production in the pilot plant and take time to fix it.

He fired hubby for insubordination. Hubby was union and had been employed by the company for 18+ years. The worst the engineer was supposed to be able to do was transfer him to another project. The union, my hubby, the engineer, and the powers that be, had 3 different meetings and the engineer was adamant and refused to budge, the company was in a quandary as to what to do, they could fire people for different reasons even if they were union. The union was up in arms about this particular issue though and were not going to allow it and were starting to toss out the idea of a strike if the company fired hubby. They felt even if he had been insubordinate his work record showed he was a good employee with not one single issue in the whole time he had been there.

Hubby decided to offer the alternative of him quitting, getting full, maximum unemployment, and money for retraining him for another job. So he walked away from his high paying job to get an associates degree, get $212 per week for the full 2 years uncontested in unemployment while he was going to school, was able to work at the local Vo-Tech teaching A+ certification classes but that pay came out of his unemployment check once he turned in his wages, etc.....

We lost my vehicle, his was paid for, we lost our home, his mom bought us the mobile home we still live in today, we lost our lifestyle, our credit, our everything.

We ended up having to go to the credit bureau's credit counselor for free and learned a lot about budgeting and trying to get the debts paid off but the man sat us down and told us some facts.

Once life changes like this it is not very often it ever goes back to the way it was. Jobs that pay high money aren't everywhere and they are seldom found again. It is almost always a huge pay cut once the person does find a job.

Once they go back to work the bill collectors will start trying to garnish wages and they don't have to ever stop calling, even if a payment is made, that just makes them realize you have money now and they want to call and bother you more so you'll pay off the bill faster. They can only take so much out of an already smaller paycheck.

It is a never ending scope of life that some people will never have to live through.

That said, we talked to the credit counselor about every option except filing bacnkruptcy. He did the program where they take our money and pay the bills for us, the companies usually go for this due to them being guaranteed some sort of payment each month. As I said we did only have a couple of credit cards with not a lot on them. The one was City Bank and it was several thousand dollars and then a Sears, Wards, Penney's, etc...the store ones had at most a few hundred.

The counselor took $1300 per month out of our take home pay. That left us with $500, at most, to pay for gasoline, car insurance, food, utilities, clothing, medications, co-pays at the docs office, every thing one could possible have that was not a loan type payment. We could not survive at all. We had to back out of the program. At that time he told us he had known going in that there was no way we would ever be debt free or even ever get the bills paid down due to our payments only partially covering the interest payments each month and the actual bills not being lowered at all.

We started paying a good attorney a bit of money each month and put up with the phone calls, the threats, all of it, and finally just disconnected the phone to stop the stress. It was hard living out in the country with no phone but we managed.

Our attorney kept all our bill correspondence and when hubby and him finally went to court it was all there and listed. I did not go to court with them but we did not lose anything from our home. We did not have excess artwork worth money, we did not have a lot of valuables in any way, he had sold off his 1800's gun collection and comic books months and months beforehand. We did not lose any possessions at all.

We survived and made it through. We have had a couple of credit cards since but decided we didn't really want the stress of something happening again.

I think you should contact your local legal aide office and get a referral for a consultation with a bankruptcy attorney. Often, it only costs $25 for a half hour consultation. Make sure that you have all your paperwork and issues in order to make explaining simpler.
There are differing forms of bankruptcy so it depends on what you can keep while having other things discharged.
You need a professional that you can discuss the specifics with prior to making a decision.
I have a friend who was hosed by a mortgage broker while trying to get a loan modification on her house. He didn't submit the paperwork, it was a big mess. She ultimately let the house go, but she was able to keep her vehicles and other personal property such as furniture and things like that.
She was devastated at first, but the bankruptcy really helped them get back on track and they are rebuilding their credit.
It's not an easy thing to go through.
I do know people that were able to keep their homes after bankruptcy so it all depends on so many different things.
I would consult with a bankruptcy attorney to get your options clearly explained to you.

Best wishes.

We filed bankruptcy many years ago. Although, we filed the chapter that you repay, they consolidate your bills. We figured we did owe the bills, just couldn't manage them. We had surgery that we found out after wasn't covered, that's what pushed us over the edge. Anyways, after a couple years, we bought a car, but put the cash in a CD and secured the loan instead of paying cash. That helped rebuild our credit. We didn't own a house at the time but have sinced purchased. Our car payment was rolled into the repayment. So, while I think we learned a good lesson, I would only do it if absolutely necessary. Good luck with whatever you decide. God Bless.

JS

There are some forms of bankruptcy that allow you to "reaffirm the debt" on your house and/or car(s), assuming you don't own them outright -- essentially, you file bankruptcy on everything but then say you will keep paying what you owe on the house/cars if you can keep them. However, there are some forms of debt that you can't file bankruptcy on (student loans, e.g.).

Most of the time, filing bankruptcy is a BAD idea. Bankruptcy lawyers (who make their money on you filing for bankruptcy) often make it sound like it's good, or an easy solution, but it often isn't necessary, or doesn't really solve the problem.

Go to http://www.daveramsey.com to find out more why it's often not a good solution, and what you can do instead of filing bankruptcy. [He's a financial counselor and radio talk show host; when he was a young man, he overextended himself flipping houses (buying properties, fixing them up and reselling them), and ended up filing bankruptcy because he owed millions of dollars and couldn't sell his properties quickly enough to pay off his debts, and he determined he would NEVER be in that situation again, so he started living on a cash-only basis, found it worked, and has built up a business helping other people through financial difficulties.] You can also try to call into his radio show (2-5 p.m. Eastern Time), and you can listen to it via the computer, if your local market doesn't carry him. People call in asking about bankruptcy all the time, so even if you can't get on (or don't want to call), you can still get some general advice that may be applicable to your situation.

Often, people who are tempted to file bankruptcy have other concerns that need to be addressed, or the bankruptcy cycle will repeat itself in the future, because the true causes of the bankruptcy were not addressed. For instance, some people file because they have overwhelming debt, but if they don't address WHY they got so deeply in debt, then they will likely just get deeply in debt again. So, if they are in debt because they simply spend too much (even though they make enough money), then they will likely keep spending more than they make even after bankruptcy; if they are in debt because they lost their job, then filing bankruptcy won't help them find a job.

Be aware that filing bankruptcy will follow you **for the rest of your life**. Many times when you fill out financial paperwork you will be asked, "Have you *ever* filed for bankruptcy?" and you will have to say yes, even if it's been 30 years since you last filed.

I filed for bankruptcy about 8 months ago. The emotional part is by far the worst. I got a company to write up the papers for me and it was about half of what a lawyer would charge. I let everything go. I have one old car that is paid off and it is in really good condition. I got divorced and all the credit was in my name so I had a butt load of bills. It was the best option for me!! You can decide what you want to keep and keep paying on. I am not a hundred percent sure how it all works. If you want a fresh start (and you are sure) then this would be the way to go.

I have not filed but I know that there are two kinds of bankruptcy and with one you lose it all and with the other you keep it and pay it bIt ack. It costs you money to file too so make sure that it is worth it. You are being smart by asking real people and experiences instead of taking the attorneys word for it. They get paid if you file....
Think about selling all that you can instead of filing and having it taken. If it is a car, sell it, if it is a house, sell it. It is better than being taken and them selling at little to nothing and then coming after you for the difference. You can consider selling at a deal and then taking out a loan for the difference. For example: if you owe $10k on a car, sell for $6k and get a loan for $4k so you have less payment but yet don't ding your credit and save the money on filing. Find a way out if you can... good luck!

You know you ask for help and ask everyone to lay it all out, but mention don't even ask you a question, anyway...my sister filed bankruptcy and divorced her husband at the same time. I am not sure if she filed 7 or 13. They kept their house and two cars. They both remarried and 5 1/2 years later she has left her new husband, but did not divorce him. She purchased a car from my husband recently and he said she was scared to do it, but she had a REALLY high credit score. For him to say that, it must be high.

Good luck to you. Not to get in your business, but just saying.