Which way to go??????

[Allmixedup]

Hello to everyone! I am new here! I am soooo confused as to what to do right now. Any advice given to me would be great. Here goes my situation.
Right now I feel squeezed like a lemon w/ my bills (as I am sure everyone these days are) My husband and I both work full time. He works in the Auto Industry and is temp. layed off. (3 weeks in April, 4 weeks in May and some other weeks to follow in July ) My job is pretty secure right now. We make appr. 3700 per month. Mortgage is almost 1200 oer month (not including taxes)! It is almost 60 days behind! We are currently trying to workout a hardship program with them where they will drop the payment for 6 months! They have done this one other time before for us. This is only a temp. band-aid for this loan however. We owe app. 132,000 on this loan and are completly upside down, as we bought at the peak of the market! They are not participating in the Obama plan for modification. Besides that we also have a personal loan for 15k with the same lender (yikes I know)! BTW the rate for the mortage is like 9.85%!! The rate for the personal loan is 15.99%. I have paid on this loan for almost 3 years and the balance is still the same! I only have 3k debt in cc. I am 1500.00 behind on our property taxes from last summer and not to far behind from getting the new bill. Basically to cut a long story short , our income vs. debt is a wash! We having nothing left over each month! I am soo confused on what we should do1 I have researching my options for weeks and cannot sleep at night! My mond is racing.....First, I was thinking of Chapter 13 because my husband wanted us to keep our home. But then at other times I am thinking of chapter 7 and surrendering the home because it seems as if we are treading water as it is. It is much harder to talk him into this, as he faces the thought of us losing our home as a failure and embarresment. I am so over the emotional part of this though. I want to do what is best for my family (I have three kids)! I am open to any thought and suggestions that anyone has to offer! BTW I live in MI in case anyone was wondering. ( I think I posted this in the wrong forum the first time Forgive me...I am a newbie winging it..lol)

[pookieny]

If you have no equity in your house, then why not do a 7? You could file on the $15,000 and the cc debt. What kind of car loans do you have?

[SBayBruce]

Just my opinion, but I would say, anyone considering BK given the mark it puts on your credit record for all those years, should attempt a Chapter 7. you should talk with your husband about it and let him know, the critical thing here is that you are in severe financial distress, the decision is purely a business one, what others think, can not play into it. I know it's a harsh situation to be in, but if your income does not support servicing a mortgage, you have to either restructure that mortgage or get away from it. The best course if you haven't already is speak with an attorney that specializes in bankruptcy to get all your options.

Best of luck to you

Filed: Chapter 7: Dec 1999
341 Metting: Jan 2000
Discharged: April 2000

[TEW]

Have you done a means test yet maybe the decision is not yours.
http://www.legalconsumer.com/bankrup...test/index.php

[fltoo]

With your salaries and 3 kids, there is no doubt you qualify for a chapter 7.
I think you are on the right track of surrendering the house, rent a cheaper place (no taxes, no insurance, no maintenance) and file the BK.

But, do some research, there is a lot of planning to do before filing.

Get a new start. Nothing to be ashamed of.

[kathy4530050]

AllMixedUp,

Welcome to the greatest forum anywhere. You'll find incredible wisdom, experience and support here. I know your panic and your dread. I am a Michigander too and am self-employed. Right now, all of my work is out-of-state as there is NOTHING is MI.

It takes awhile to get used to the idea of bankruptcy as most of were raised to believe it only happens to other people. However, now that I am used to the idea (this forum helps), I am planning to move forward with the bk with thoughtful, careful planning and position myself for the best possible outcome. I think that a bankruptcy done right can result in a massive burden being lifted off your shoulders and a true fresh start.

I know there are a lot of people out there who will want to talk you out of filing , but I think it's good to ask yourself where you'll be in 5 years if you don't. To struggle so hard to just barely survive is not a life. To work and work and work and find yourself falling into a deeper and blacker hole leads to hopelessness and despair and you and your family deserve better.

We all know all the stuff about what a bk does to our credit rating, but you know what? It was my great credit rating that got me into this mess!! My business was in trouble and more and more and more credit kept getting extended to me all because of my great credit rating! Now, without that great credit rating, I'll be living a 100% cash existence and THAT SOUNDS GREAT to me. Clean living--I'm ready for it.

I know how hard it is to lose your home. I lost mine and I am renting now. I miss my house and I miss the feeling of "this is mine", but I have made peace with my decision. I'm renting a nice house and my kids are fine with it. If I rent for a few years, it's worth it to enter this next phase of my life debt-free and unencumbered. I know I'll buy another house in the future and, without all of this debt, I'll be able to save for it. And so will you.

It's a big decision and no matter what you ultimately do, you're not a better or worse person for having done it. S**t happens, and we do our best to deal with it and then get on with our lives. No one else can stand in judgment of you if they haven't lived your life. They can try, but you don't have to let it get to you. Lots and lots of good, decent, honest, hardworking people have filed for bankruptcy and go back to leading responsible lives.

If you hang around this forum for awhile, you'll come to respect the intelligent people who have successfully come out on the other side of bankruptcy and are generous and kind enough to share their experience with the rest of us.

Hang in there and know that you in the company of lots of other people who know exactly how you feel and had to make the same gut-wrenching decision. It does get easier.

Warm thoughts from a fellow Michigander,

Kathy

[JRScott]

Hello and welcome.

You have a gross of 3700 a month or a net?

1200 for a home payment not counting the taxes, what does the tax and insurance more cost you?

Do you have car payments?

Just trying to figure out how you got behind .

How about student loans?

[Allmixedup]

Thank you to everyones opinions so far...To answer some the questions asked. Well to JRScott 3700.00 per month bring home ONLY when my husband is working full time. In the past he has been layed off and that is what keeps getting us behind. He is now on another lay off(3 weeks in April, back to work for 2 weeks then 4 weeks in May) The inconsistency of the income is making it hard to stay afloat. We do have 2 car payments that total 560 per month. Our homeowners Ins. is 60 per month and the taxes are 2500 per year which are behind as well.... I do not have equity in my home. Quite the opposite actually What I failed to mention is that our marriage is not in a good place either So, through some soul searching and lots of thought..we have decided to file ch. 7 and surrender the house! It is the best financial decision for us both. Neither one of us can afford the house on our own and we are going to separate when we have to move. (I am not planning on getting a divorce right now. We have 3 kids together and want to see if we can still make it work down the road,) but taking the financial burden out of the picture help. I do have another question for Kathy....Since you also left your home, I was wondering if foreclosure and bk goes on your credit or just bk? The separation is why a chapter 13 would not work for us I do not want to get locked into something is in the end is not the best decision. And to the other comments, I have been doing my research. I know this isn't an easy decision but we are calling the attorney tomorrow. So I will update when I know more Thanks for the support! It is nice to find a place where people are supportive and not discouraging

[kathy4530050]

Thank you to everyones opinions so far...To answer some the questions asked. Well to JRScott 3700.00 per month bring home ONLY when my husband is working full time. In the past he has been layed off and that is what keeps getting us behind. He is now on another lay off(3 weeks in April, back to work for 2 weeks then 4 weeks in May) The inconsistency of the income is making it hard to stay afloat. We do have 2 car payments that total 560 per month. Our homeowners Ins. is 60 per month and the taxes are 2500 per year which are behind as well.... I do not have equity in my home. Quite the opposite actually What I failed to mention is that our marriage is not in a good place either So, through some soul searching and lots of thought..we have decided to file ch. 7 and surrender the house! It is the best financial decision for us both. Neither one of us can afford the house on our own and we are going to separate when we have to move. (I am not planning on getting a divorce right now. We have 3 kids together and want to see if we can still make it work down the road,) but taking the financial burden out of the picture help. I do have another question for Kathy....Since you also left your home, I was wondering if foreclosure and bk goes on your credit or just bk? The separation is why a chapter 13 would not work for us I do not want to get locked into something is in the end is not the best decision. And to the other comments, I have been doing my research. I know this isn't an easy decision but we are calling the attorney tomorrow. So I will update when I know more Thanks for the support! It is nice to find a place where people are supportive and not discouraging

AllMixedUp,

It sounds like you and your husband have come to a rational decision. Hopefully, in the not too distant future, you'll have a little peace in your life. From one I understand, with the exception of utility bill, EVERYTHING shows up on our credit reports. However, a foreclosure on your home and a bk do not necessarily go hand in hand. Lots of people lose their homes and never file bk, and plenty of people file bk and keep their homes. I decided to let my home go because I didn't have any equity in it, and was planning to move to another city and new it would be really, really hard to sell it in this market.

Moving, as it turns out, was really, really smart and if it is possible for you to do what I did, I would really recommend it. When I moved, I had my mail forwarded to my new address, of course, so the bills still came in, but I had my phone put in my SON'S name. Thus far, I have had NO calls from creditors because they don't know where I am!!

Best of luck as you move forward. It sounds like life is going to be pretty intense for you for a little while, but if you read the stories of everyone here, I think we've all been through some pretty intense times. I think that once you make peace with all of the changes and challenges coming your way, you'll be ok. For me, the acceptance part was HARD. But once I got over that hurdle, the rest was all do-able.

Take care,

Kathy

[Allmixedup]

In response to you kathy,
I agree moving would be in our best interest. We are in the same position as you. I have absolutley no equity in our home. Not to mention it is the worst loan and interest rate imaginable. Thank you for your encouragement! Peace is what I am hoping to bring to my family once and for all! I am still slightly confused on the whole credit report thing though. If I file ch. 7 and surrender my home then will foreclosure be on my credit report? Sorry to sort of ask this again, I just didn't have a clear answer. I know I will have to go rent somewhere, and I do not anticipate buying another home for a long time, but I just wonder how hard it will be to even find a house to rent? I know several other people say that it isn't that hard, but I am just not sure.

[dingdong]

I have the crappiest credit in the world, and have had no trouble renting.

Crappy, crappy, crappy.

But, Happy, happy, happy!


IF your home is foreclosed on ,the lender may report it on your CR.

Of course with all the FC and crap that is going on with banks, who's to say they won't make a small error in their reporting of the FC which might require you to dispute the entry.

And.... since the banks are so incredibly disorganized and buying each other out, can't produce note, don't know who the investor is for the mortgages they are servicing, perhaps said bank doesn't resond to your inquiry?

Delete, delete, delete.


Once you are out of the financial pickle, your DH may seem much more attractive as a DH.

Don't give up hope on anything including your marriage while you are having financial stress, once the stress is lessened you may find you get along a lot better.

[kathy4530050]

In response to you kathy,
I agree moving would be in our best interest. We are in the same position as you. I have absolutley no equity in our home. Not to mention it is the worst loan and interest rate imaginable. Thank you for your encouragement! Peace is what I am hoping to bring to my family once and for all! I am still slightly confused on the whole credit report thing though. If I file ch. 7 and surrender my home then will foreclosure be on my credit report? Sorry to sort of ask this again, I just didn't have a clear answer. I know I will have to go rent somewhere, and I do not anticipate buying another home for a long time, but I just wonder how hard it will be to even find a house to rent? I know several other people say that it isn't that hard, but I am just not sure.

I wouldn't worry too much about this. Yes, a foreclosure will show up on your credit report, but you can still find a house to rent. It takes awhile for the foreclosure to happen (esp. in MI now) and that means you can go ahead and find a place to rent before this shows up on a credit report. The last month I made a mortgage payment was last June, and the foreclosure is just happening now. Also, I rented a house from an individual (in October), not a complex. The person I rented from never even did a credit check. I think you'll be ok. I doubt that my foreclosure is even on my credit report now, 9 months after my last house payment, because the process hasn't finished yet. I think you have plenty of time to find a house to rent.

[TEW]

I wouldn't worry too much about this. Yes, a foreclosure will show up on your credit report, but you can still find a house to rent. It takes awhile for the foreclosure to happen (esp. in MI now) and that means you can go ahead and find a place to rent before this shows up on a credit report. The last month I made a mortgage payment was last June, and the foreclosure is just happening now. Also, I rented a house from an individual (in October), not a complex. The person I rented from never even did a credit check. I think you'll be ok. I doubt that my foreclosure is even on my credit report now, 9 months after my last house payment, because the process hasn't finished yet. I think you have plenty of time to find a house to rent.

The foreclosure will not show up on the credit report it will show like everything else (IIB) included in bankruptcy In 2 or 3 years you can buy another house as long as you don't have anymore bad marks after your BK on the CR.
Once you've gotten the the point where there are no other options beside BK your credit report is the least of your problems. learning to live with in your means is something you need to do after your discharge so your credit report is not all that important in my opinion.

[Allmixedup]

Yes, I agree with what everyone has said. I have an appointment with an attorney next week. Just still a little apprehensive. I have filed bk almost 10 years ago and never thought that I would be back in the same pickle again! Ugh! It's not that I haven't learned any lessons...it's just the job lay-offs that keep holding us under water. That leads me to a new question. If I have filed a long time ago and it is still lingering on my credit, then will I have 2 bks and will that be even worse? I think the first one will be off the reports as of Dec. 09'. I know I should'nt be worrying so much about my credit, but it's hard not to. My husbands credit is finally back in the higher 600's. Not to mention our bills aren't all that late yet compared to what they could be. (Well they will be soon due to his lay-off). Sorry to babble on like this. Just still many questions running in my mind. I guess I just want to be sure to do the right thing before I drop 1400 to a lawyer and bomb the credit scores!

[tkharvey]

I am right there with you. We, too, are trying to file a Chapter 13 so as to keep our house (which is about to foreclosed upon). We built this house four years ago when we were making nearly four times what we are now (my husband is a real estate agent). We are trying so hard to keep our home. This is our dream home and have put so much into this to make it "ours". We have three daughters who feel secure here and I just feel terrible to have to uproot them and rent. I never thought I'd be in this situation. Am trying to look at the bright side, knowing that we will be debt free when my plan ends, but at the same time, I want to stay here. It's so upsetting and am so afraid.