Scared/Confused Help with Ch 7?

[overthedebt]

I've been reading as much as I can on Ch 7 and I'm so scared and confused. I've called an attorney but he is so backed up I can't even go in for a consult for another 6 weeks. In the meantime, would you experts help me understand if Ch 7 is an option for me?

I'm mortified that I've created this mess for myself (well, with a little help from an abusive, unemployed alcoholic husband too ). Anyways, here is the run-down (current on all payments):

Credit card debt: 65K
Mortgage: $280K (home value pretty much break even at this point)
Car: 2003 Audi with 85K miles, owe a few thousand on it.
Current Job: $14/hr, 40 hr temporary ending in October.
IRA: $22K left at this point.

We were doing fine until about 3 years ago when my husband's alcohol and drug addiction wrecked our lives. He lost his job and became basically unemployable. To make ends meet, I used those credit card convenience checks to keep going. Stupid, I know. My thinking was that when our house sold (it's been on the market almost 2 years now), I would just pay it back. This was right before the housing market got bad. I didn't take from my savings at the time because I thought it was best to keep it invested. Then the financial crisis hit and the value got wiped out. Stupid move #2 on my part.

Anyways, would I qualify for Chapter 7? Would I be able to stay in my home and keep my vehicle? I would be filing as an individual (we aren't divorced yet but the CC debt is mine). What would happen if my house did eventually sell and there was a gain? Does the court come back and take the equity at that point? I'm hoping to just stay in my house and get roommates to keep up with the mortgage payments until the market starts to recover. Any help is appreciated. I'm so embarassed that I'm in this position. I've seen my credit score go from 781 to 681 in a month because of my debt-credit limit ratio (they all got reduced to the current balance). So, I'm already seeing my credit worthiness drop at this point anyway. I just want to get to the other side of this and not have all this weighing on me. Thanks in advance for any help.

[TEW]

I've been reading as much as I can on Ch 7 and I'm so scared and confused. I've called an attorney but he is so backed up I can't even go in for a consult for another 6 weeks. In the meantime, would you experts help me understand if Ch 7 is an option for me?

I'm mortified that I've created this mess for myself (well, with a little help from an abusive, unemployed alcoholic husband too ). Anyways, here is the run-down (current on all payments):

Credit card debt: 65K
Mortgage: $280K (home value pretty much break even at this point)
Car: 2003 Audi with 85K miles, owe a few thousand on it.
Current Job: $14/hr, 40 hr temporary ending in October.
IRA: $22K left at this point.

We were doing fine until about 3 years ago when my husband's alcohol and drug addiction wrecked our lives. He lost his job and became basically unemployable. To make ends meet, I used those credit card convenience checks to keep going. Stupid, I know. My thinking was that when our house sold (it's been on the market almost 2 years now), I would just pay it back. This was right before the housing market got bad. I didn't take from my savings at the time because I thought it was best to keep it invested. Then the financial crisis hit and the value got wiped out. Stupid move #2 on my part.

Anyways, would I qualify for Chapter 7? Would I be able to stay in my home and keep my vehicle? I would be filing as an individual (we aren't divorced yet but the CC debt is mine). What would happen if my house did eventually sell and there was a gain? Does the court come back and take the equity at that point? I'm hoping to just stay in my house and get roommates to keep up with the mortgage payments until the market starts to recover. Any help is appreciated. I'm so embarassed that I'm in this position. I've seen my credit score go from 781 to 681 in a month because of my debt-credit limit ratio (they all got reduced to the current balance). So, I'm already seeing my credit worthiness drop at this point anyway. I just want to get to the other side of this and not have all this weighing on me. Thanks in advance for any help.

With what you have written here you shouldn't have a problem with a chapter 7.
With what you are making can you afford that house? if you file thats the best time to get out of it.
The car you need to look up on KBB.com to see what it's worth. Then find out how much you can exempt in your state for your car.
LEAVE the 401 K ALONE that's exempt and you are going to need it when you can retire.
Saving depends on how much you can exempt. If you can't exempt it spend it on NEEDED things.

[overthedebt]

With what you have written here you shouldn't have a problem with a chapter 7.
With what you are making can you afford that house? if you file thats the best time to get out of it.
The car you need to look up on KBB.com to see what it's worth. Then find out how much you can exempt in your state for your car.
LEAVE the 401 K ALONE that's exempt and you are going to need it when you can retire.
Saving depends on how much you can exempt. If you can't exempt it spend it on NEEDED things.

Thank you for responding.

I can afford the house with roommates (it's a 4 bedroom home). 2 people are interested at $600 each (mortgage/taxes= $1700 total so that would leave me at $500/mth). I put a lot down on the home ($70K) and I'd hate to walk away at this point. I'd rather try to hold on and see what the market does in the next 3-5 years. Hoping my job hunting will eventually land me a better paying job as well (college graduate, extensive sales/management experience so here's hoping something happens eventually). If I rented the house outright through a realtor is that considered income? That's also something I thought about. Then again if I file, it might be hard to find an apartment with bad credit. :/

Looked up the car and it's worth $6500. With the high miles, I'm worried about it. I've read on some threads that you should look into getting a more reliable vehicle before you file? Audi's suck at this age.. seems like more time is spent in the shop than on the road. If I got another car would it have to be another older car? Or could I get something a little newer and more reliable to get me through the years right after BK? Not sure if getting a new loan looks bad to the court?

IRA.. I thought it's only exempt in certain states? I thought the courts take that? Actual savings is next to nill at this point. I've been draining it trying to keep up with the mortgage and minimums on my cards. Should I stop paying to save money? I'm so confused about all of this. I'm sure the attorney will clear up a lot of this when I finally get to meet him. Until then, I'm anxious and worried.

Thanks again for your help! It's appreciated.

[mamaluv]

I'd be leery of holding onto the house if you cannot afford the payment on your income alone....what if one or both of your roommates lose their jobs? What if they decide to move? What will you do?

[overthedebt]

I'd be leery of holding onto the house if you cannot afford the payment on your income alone....what if one or both of your roommates lose their jobs? What if they decide to move? What will you do?

Wouldn't they just take the house then too? Between the $$ put down on it and the sweat equity in making it a nice home, I'd like to try to find a way to keep it until the market stabilizes. My potential roommates are friends and I guess they could change their minds but they're committing to 12 months. Both are teachers so I think they are pretty stable income wise.

[keepmine]

IRA's are exempt up to $1,000,067. Don't touch it.
As to the house-I'd be leary of depending on the income of others as well as your low income. Whatever you do, don't sign a reaffirmation agreement.
Get those transpotation needs taken care of prior to filing. Buy a car with a reasonable payment and you'll have no issue with the bk court.

[overthedebt]

IRA's are exempt up to $1,000,067. Don't touch it.
As to the house-I'd be leary of depending on the income of others as well as your low income. Whatever you do, don't sign a reaffirmation agreement.
Get those transpotation needs taken care of prior to filing. Buy a car with a reasonable payment and you'll have no issue with the bk court.

Thank you! I had no idea the IRA was exempt. Update on the house situation but I'm starting a new thread about that since I'm confused about what to do there. Thanks again for the information.