To go or not to go?

[papie]

We didn't give bankruptcy much thought before we filed. We had tried to a do a home mod, made all the trial payments and sent in all the paperwork, and one day the sheriff was at our door to serve us papers for foreclosure. I freaked, between my husband's unemployment and the medical bills, losing our home seemed like the worst thing ever. I consulted with a lawyer and we filed a week or so later.

We are on a 3 year/ 100% plan and we're over a year into it. The initial shock of filing is over and we've been thinking about our current situation and the future a lot.

I don't think we should have kept the house and it's getting increasingly hard to keep up with things AND the house. We've already hit our $3000 deductible for our health insurance this year. That doesn't include medical bills we've paid up front. Right now, just this week, I received ~$1200 in medical bills. I'll have to set them up on payment plans. The story of my life, I'm not worried about them. Hospitals like payments.

My husband's office relocated and I found a job in a larger nearby city. We can't find jobs closer to our home. We each drive ~150 miles per day (can't carpool, we have completely different hours.) As it stands, we spend about $500/month in gasoline just getting back and forth to work. The wear and tear on our older, higher mileage vehicles is insane, and we have major repairs every month.

Our house has major issues, heat being one of them. We need all new ductwork and a new furnace. Our electric bill has been around $400/month this winter. We have a small house and we have every crack and hole sealed up. I don't know what else to do. We have septic issues, well issues, roof issues, leak issues, it's endless.

We can pay our monthly bills and we are making our trustee payments, but something has to give, we do what we can do large repairs and maintenance to the degree that we need to right now. We are literally steps away from a major meltdown and we are on a very tight budget. We do what we can do here and there, but when one of those major home issues gives out, we're screwed.

Renting a place closer to work would save us literally, hundreds of dollars per month and allow us to stay on top of medical bills.

I know we're upside down on our house though, so my main worry is a deficiency judgement if we do let it go back to the bank. Are those common? The loan is with US Bank, if that matters.

I'll of course run all of this past my lawyer. I'm not entirely sure how the foreclosure process works. We would obviously need to save for a few months, or wait until my June bonus (trustee doesn't take my bonuses) to get a rental and all that jazz. I can't deplete our savings on apartment deposits and stuff right now because we have a lot of co-pays and prescriptions. The hospital will not render services if we don't at least make regular payments. How does all this work and how likely is it that I would get a deficiency judgement since I live in a state that allows recourse? It we want to surrender the home, it would be better to do it while in active Chapter 13, right? As opposed to waiting until it's closed and dealing directly with the bank?

I just typed a book, so any feedback would be appreciated. lol

[lrprn]

Papie, you've already given yourself the best answer - your house is more than you can afford on your current income flow combined with the extreme commutes you both have. You need to explore what will happen if you change your plan to surrender the house, reduce your commute, rent something suitable, and move on.

Set up a face-to-face appointment with your lawyer and lay out everything you've listed here on the table. Discuss what the best options are for your family moving forward keeping or not keeping the house.

[Pandora]

We are on a 3 year/ 100% plan and we're over a year into it.

3 year 100% plan, so under median. Is all of your debt secured? What percentage is going to unsecured?

Reason being is that if most of your plan is funding unsecured then given you have such high medical, you should be able to submit to your lawyer evidence of such and ask that your plan be modified due to excessive medical (if on-going). As to the gas allowance, I'm not sure if you can amend that or not, but its worth a try given gas prices are steadily on the rise.

Agree with Lrprn - time to meet with your attorney.

I'm sorry you're having such difficulty (hugs).

ETA: Just read your other post:

We were able to opt for a three year plan and asked our lawyer to make it one solid higher payment so we could get it paid off in three years. (The original plan was five years, with the plan payment increasing the month after the car was to paid off.)

You're strapping yourself in a bad way. While I understand the desire to pay the plan off early, you may have shot yourself in the foot by doing this. How is it you were org. a 5 year but were approved for a 3 year plan? Did you give up assets to do so? Our plan would've been 36 months, however given the Ch. 7 test applied and all of our assets (vehicles) were paid for - it created a base minimum to be repaid. Income at that time wasnt able to fund a 36 month plan payback for what we had, so it was extended to 60 months.

[papie]

3 year 100% plan, so under median. Is all of your debt secured? What percentage is going to unsecured?

Reason being is that if most of your plan is funding unsecured then given you have such high medical, you should be able to submit to your lawyer evidence of such and ask that your plan be modified due to excessive medical (if on-going). As to the gas allowance, I'm not sure if you can amend that or not, but its worth a try given gas prices are steadily on the rise.

Agree with Lrprn - time to meet with your attorney.

I'm sorry you're having such difficulty (hugs).

ETA: Just read your other post:

We were able to opt for a three year plan and asked our lawyer to make it one solid higher payment so we could get it paid off in three years. (The original plan was five years, with the plan payment increasing the month after the car was to paid off.)

You're strapping yourself in a bad way. While I understand the desire to pay the plan off early, you may have shot yourself in the foot by doing this. How is it you were org. a 5 year but were approved for a 3 year plan? Did you give up assets to do so? Our plan would've been 36 months, however given the Ch. 7 test applied and all of our assets (vehicles) were paid for - it created a base minimum to be repaid. Income at that time wasnt able to fund a 36 month plan payback for what we had, so it was extended to 60 months.

We have secured and unsecured debt in the plan, we're paying back 100% of the unsecured too. We were never confirmed at a five year plan. When we had originally spoke with our lawyer he had calculated everything based on a five year plan, then when we went to sign the papers he said we could do the three year, so that's what we did. I would have liked to take it out to five years but having an open bankruptcy is like a monkey on my back. I work in finance and in my sector most people want to run credit and background checks. Some companies will accept a closed bk case if I have a good explanation, but an open bk case is a big red flag for them. I was lucky that my current employer didn't request any checks, so I keep my mouth shut in hopes that it never surfaces. Don't ask, don't tell I suppose. Finance jobs aren't plentiful right now and an open bk puts me at the end of the candidate line. God forbid I get laid off from my current job before this 36 months is over. My husband's health issues make me feel like we can't depend on his income at all.

I think we could make do with a lot of home issues until the bk is closed and struggle and push through them, we've done it for years now. (We waited way too long to file bankruptcy.) I think there's really just a part of both of us that's totally over the whole situation, including the house, and we're kind of at the point that we don't care what happens to it. I want it gone, I want to finish this bk, and I want to get the hell out of Dodge. I feel completely irresponsible in saying that, but that's what it has come to.