Our income had steadily been rising until I got let go from my job in late 2008. I was unemployed for a month and things just went haywire from there. We were behind in paying our mortgage cause it was too high now that we were only on one income, even though temporarily stopped paying our cc bills. The rest of 2008 and 2009 were really shaky because I got laid off in early feb 2009 and dh's department got moved out of state. So we were both really scared. Our house payment finally got caught up in 2010 with tax refunds, bonuses and steady jobs. Then in May 2010, we got sued by Discover. We were able to make payment arrangements with them and I thought things were better. Then in June of 2010 we get sued by citicards and they refused to make payment arrangements and demanded $9,500 to settled our account. I went to CCS to try and do a DMP type of payment plan and I would have to come up with an extra $1500 a month for 5 years. We ran through our savings, 401k and bonuses. We had nothing to give them. The lady at CCS told me that we need to file bk or else they will garnish our wages (they're allowed up to 25% of net income in WA). I remember cry and feeling like the worst failure in the world. I couldn't believe that we are in this position. I had been trying to crawl out from debt for what seemed like forever. Prior to citicards suing us, our balance with them was $9,500 and the amount that they sued us for was 19K. They added on 10K in bs fees. I took another 2 weeks to mull over the numbers (I only had 20 days to reply to the summons) and finally retained a lawyer in early July. The first one I picked out told me that under no circumstance do we qualify for a chapter 7 because of our income and that we would be in a ch13. On the advice of this board I started interviewing other attorneys. I think I interviewed a total of 10. I finally decided on this Scottis attorney close to my house. He was cheaper but he was certain that a 7 would be no problem since we had 3 kids, every allergy known to man and a huge mortgage. On July 30th, we finally filed and then on Sept. 15, we had our 341 and it went smoothly. The last day for the creditors to object is today and we should get our discharge soon.
Since September, I have been able to save $11,500 towards our next house. Originally, we had planned to keep the house but after working and re working those numbers in our budget, we would still be in trouble because even though we are both working now, we make less money than before. We decided that we are giving up this house because payment comes out to like 45% of our net income. My MIL has graciously said she would buy us a house under her name and when we can refinance in a few years, it will be in our name only. We are hoping we can stay until at least the spring time when we can fully start looking at houses with enough money saved up. Now if Bank of America lets us modify our house for around $1500 a month, we would be okay but right now we lost $100K in value and our mortgage payments were $2700.
Since filing required me to do so much research on our spending habits, we cut back on going out to eat, trips/vacations, hair cuts, we don't go out and we stay home all the time. It's boring but I'd rather be boring than go back to the stressful time before we filed. Every month since filing, we write down our budget, allocate money to savings before it hits our paychecks, contribute more on 401k + roth ira and we finally learned to live within our means. Our bills get paid every other week as they come due. There's no more NSF fees, late fees, etc.
We're already getting cc offers in the mail but I really don't want to touch one again until we have at least 30K in savings and until we clean up the credit report. I'm giving us a whole year to really be on our feet without the cards so we can avoid getting back into debt. The bankruptcy really changed the way I look at debt, credit and money. Now, I think I like to hoard money vs going out shopping with my girlfriends or going out to eat all the time. Now, I stay home on the weekends and I don't leave my house unless it's for groceries or for gas. I cut coupons like it's a religion. I don't buy new clothes unless something is completely worn and unabled to be repaired. I've been so frugal that I get teased all the time from my friends who have no idea that we went bankrupt. I hope one day I can not be so scared to spend money but for now, I've learned my lesson and I'm never going to let my money control me again.
I finally took the time to write this all out with the hopes that it helps someone. If you are just starting the journey, just know that it's hard but once you go through it, there's peace to be found. I'm not necessarily ashamed that I filed bk but would I go out in the world and announce it? No. But, I have learned from it.
Since September, I have been able to save $11,500 towards our next house. Originally, we had planned to keep the house but after working and re working those numbers in our budget, we would still be in trouble because even though we are both working now, we make less money than before. We decided that we are giving up this house because payment comes out to like 45% of our net income. My MIL has graciously said she would buy us a house under her name and when we can refinance in a few years, it will be in our name only. We are hoping we can stay until at least the spring time when we can fully start looking at houses with enough money saved up. Now if Bank of America lets us modify our house for around $1500 a month, we would be okay but right now we lost $100K in value and our mortgage payments were $2700.
Since filing required me to do so much research on our spending habits, we cut back on going out to eat, trips/vacations, hair cuts, we don't go out and we stay home all the time. It's boring but I'd rather be boring than go back to the stressful time before we filed. Every month since filing, we write down our budget, allocate money to savings before it hits our paychecks, contribute more on 401k + roth ira and we finally learned to live within our means. Our bills get paid every other week as they come due. There's no more NSF fees, late fees, etc.
We're already getting cc offers in the mail but I really don't want to touch one again until we have at least 30K in savings and until we clean up the credit report. I'm giving us a whole year to really be on our feet without the cards so we can avoid getting back into debt. The bankruptcy really changed the way I look at debt, credit and money. Now, I think I like to hoard money vs going out shopping with my girlfriends or going out to eat all the time. Now, I stay home on the weekends and I don't leave my house unless it's for groceries or for gas. I cut coupons like it's a religion. I don't buy new clothes unless something is completely worn and unabled to be repaired. I've been so frugal that I get teased all the time from my friends who have no idea that we went bankrupt. I hope one day I can not be so scared to spend money but for now, I've learned my lesson and I'm never going to let my money control me again.
I finally took the time to write this all out with the hopes that it helps someone. If you are just starting the journey, just know that it's hard but once you go through it, there's peace to be found. I'm not necessarily ashamed that I filed bk but would I go out in the world and announce it? No. But, I have learned from it.
But it sounds like you bounced back from this pretty well and have a very respectable savings in just a couple months! You'll be a homeowner again in no time!
341 3/2/11 
Waiting for discharge........
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