File 7 or wait it out. Scared

[ingrid29]

I have over $60,000 in cc from a very struggling business. Husband and I were both self-employed and have had zero income for the past year. We have survived through a loan from relatives.

I have been contemplating chpt. 7 for a number of months. Just me - not my husband. He has cc debt, about $20,000 but it is all current and he does not want to file. I consulted an attorney several months ago and he said to wait until my husband's impending job came thru and then file (probably thinking that if he didn't get employment we might get behind on mortgage).

Husband started a job last month; good salary, our expenses are close to income, but we can scrap by. If I increased my income, as planned, we'd be doing fine. I need to file while I still can with the means test. I also need to look for a job or consulting work but have held off so that I could file and also haven't had the money to file anyway. Plus, I am afraid if anyone does a credit check for employment, there's no way they'd hire me. I worry about this with a bankruptcy as well.

I have also been going back and forth with filing or just waiting the whole mess out and hoping I can either settle with the companies at some point, or they pass the sol and fall off my report. I have now been late on most payments almost a year. I have a number things in collections, the calls come every day, etc.

I live in Tx so they can't garnish wages (have none anyway), can't take our home, and I have nothing else anyway. I am judgment proof, for now, but won't be forever (I hope anyway).

I know that it is always a personal decision about whether or not to file. I am realizing now what a toll this has taken on me. I used to be successful and driven. I now feel deep shame, it's hard for me to get motivated. I spend too much time looking into all of thisi and it has affected my marriage.

Some of you have described a feeling of peace after filing. That's what I need. I feel I am stuck. But, I worry about regretting my decision later and wishing I'd stuck it out and not filed. It's forever.

I have to make a decision soon because in a few months, I won't be able to file a 7. Guess I know I have to do this but, like many, I feel like I am starting all over at 48 after being successful and secure for years. I am grieving, I guess.

So, just wondering if anyone has some compelling reasons, or stories, about not filing bankruptcy.

[DeadManCrawling]

Not filing is an option, but not a good one in my opinion.

I have been riding out collection calls for almost three years now, and, who knows, may make it to statute of limitations. This is not really my goal, though, and I don't honestly expeect to gt that far.

Some people do, though it's not generally wise.

Starting over at any age is a challenge, but I would posit that not filing will be worse and actually prevent a new start in the first place.

Remember, too, a couple things: SOL restarts every time you make a payment, even a small one.

Settling is an option, but they can STILL sell the deficiency to JDB's. Gotta be careful that any agreement rules this out. Having an attorney help with repeated settlements may end up costing as much or more tha bk, which wipes it all out in one move.

Finally, even if you rode out the SOL, you'd still need to assert the SOL affirmative defense in court, if sued.

Most people never reach SOL, though. Debt buyers watch SOL timeframes as well, and will often sue just prior to the SOL running out.

It sounds like you've got a good idea about the reality of the situation, and I wish you well in your decisions.

Good luck to you and your family. The emotional side of things can be the toughest for any of us.

[debtprison]

With that much debt you need to get a good attorney to advise you of all the pitfalls and look individually at the situation.

Since you had a business is there any tax debt at all? Tax debt can be tricky as I found out. Had I waited a few years until filing bankruptcy I could have wiped out $20,000 in tax debt but I didn't know that at the time.

[ingrid29]

Thanks for the replies. Posting kind of helped me realize that to move forward, I needed to get out of this situation more quickly. It's been holding me back for months now and taking a huge emotional toll that I hadn't even realized.

I have talked to a bankruptcy attorney who I really like. I don't have any huge tax bills, just about $2000 in personal taxes, too new to include in a bankruptcy, and we will just have to pay those off as quickly as we can.

Given the means test, I have to time a Chpt. 7 right. Given my husband's recent employment, I have the next few months to file, and then I wouldn't qualify for a 7.
My attorney said to basically lay low until I can file and meet 30 days later with the trustee. He says I don't want to give the impression that I will be going to get a job that would then allow me to pay the debts. Slim chance of that in this economy. My goal is to try to build the business after the bankruptcy.

I am fortunate ( I think) that my husband will not be filing and we can use his credit to take care of things like insurance, etc. while I rebuild my credit. I was always very responsible with credit and lived well within my means. Like someone else said here, I am viewing this as a business decision for Me Inc. I've finally realized I need to make the move and carry on with life. I appreciate the feedback. I have more questions, but will post them separately.

[hereforinfo]

I am fortunate ( I think) that my husband will not be filing and we can use his credit to take care of things like insurance, etc. while I rebuild my credit. I was always very responsible with credit and lived well within my means. Like someone else said here, I am viewing this as a business decision for Me Inc. I've finally realized I need to make the move and carry on with life. I appreciate the feedback. I have more questions, but will post them separately.

Ugh, bad idea. It sounds like you're going to continue using credit for basic expenses while you try and build up the business again. The same business expenses that you are filing bankruptcy on? Probably not a good idea to file or try and start a business until you have the ability to meet your expenses without credit cards.

[ingrid29]

Ugh, bad idea. It sounds like you're going to continue using credit for basic expenses while you try and build up the business again. The same business expenses that you are filing bankruptcy on? Probably not a good idea to file or try and start a business until you have the ability to meet your expenses without credit cards.

Actually no. The present business expenses are very low and I make just enough + a little more to cover them every month. The CC were for large start up costs and I payed them on time for 2 years until they raised my rates and payment + lowered all credit lines, and then I wasn't able to keep up and my business income plummeted with the depression.

I haven't used the CCs in almost a year. What I meant is my husband's credit will allow us to not use my credit, which is already as bad as w/ a bankruptcy if not worse, for things like car insurance, which will save us money. My husband's pay meets our basic expenses.

I actually plan to get a job + keep my business going, but have been told by the attorney not to do this until after the 341.

I actually had less that $1500 in CC debt before this and paid off over $50,000 in CC medical expenses 4 years ago so I am no dummy or dead beat.

[hereforinfo]

Sorry, I misunderstood. I thought you meant you could use his credit to pay for things like insurance. I wasn't implying you were a deadbeat, I just didn't want you to get back into the same unfortunate situation but now I see that's not what you meant at all.

[ingrid29]

Thank you. I realized after I posted what you'd probably thought, as my words weren't that clear. I'm a little sensitive about all of this :-) I appreciate the intention of your reply. Thank you.

[phoenixrisin]

If your cc debt was from a business can't you file based on the business- Ch 11 or something? I thought there was a special way of filing if it was business related debt?

Anyway. I think you DO have a very hard decision. I just watched a show a few days ago where a guy couldn't get a loan for his business because he filed BK from his previous business debts.

And, yes, any employer who does a credit check will see the BK. But- then again, they are also seeing the bad stuff right now, like lates, charge-offs, too.

It would be a tough debt to pay down, but if you are able to scrape by on hubby's income, and you got a job, where would you be? Most creditors after the 90 day point will heavily discount your debt to settle. If you play hardball you could settle for as low as 30% of your original debt.

If you did file I would see about Chapter 13, which allows a repayment plan.

[phoenixrisin]

Also, I just got discharged and closed from Ch7. I can't say I felt a sense of peace after filing. It has been stressful the whole time. It was nice to tell creditors to call my lawyer- and to be left completely alone after that! That does go a long way to making a person feel better- not dodging calls or screening them...

I would also find a couple other lawyers with free consults. It never hurts to have multiple opinions.

This is my own personal opinion- I don't think you should file. In my case, I couldn't have possibly ever paid back all the loans and credit cards, even on Ch13 repayment. You may be able to go to a legitimate credit counselor who can help you negotiate them (here in MD it's CCCS). You have very vaild reasons for not filing, especially if you are running your own business.

If you do file, take a look on here at what other folks do prior to BK. for one- be smart and close checking accounts with your name on them- even if joint. (or remove your name). It's tough but better than a bank levy. I wouldn't worry about not getting hired due to BK- my company simply discussed it with me because I was prior to BK and my credit stunk- all it came down to was they couldn't give me a company credit card.

My DH didn't want to file, but he wasn't the one they were all coming after. I was the one who got judgements, levies and liens because I am first on our house. He didn't want to admit failure again. When our 3 bank accounts got frozen and charged $150 each account and I had just deposited my paycheck and the money was locked up for 3 weeks- he finally said OK, lets file now... Timing is critical because we waited SO long, alot of damage hit our credit reports in the 1.5 years prior to filing. Had we filed a year or even 6 months earlier- a lot less derogatory stuff would have been reported to credit bureaus, and the judgements, liens and levys wouldn't have happened.