Too broke to file

[Waited2long]

Brought my attorney all the paperwork he needed (pay stubs, tax returns etc). Said it all looked good for a chap 7 and maybe file in a few weeks. I asked about cost and he explained his fee and filing fees etc. Hearing that I told him I probably would have to take an early distribution from my 401k to pay him. He said don't do that it is exempt. I will put you on the installment plan. Two days later I get a letter to sign to retain him and a request for $500.00 to go forward. It also explained that his full fee would have to be paid before he will file. I understand why I need to start paying but it will take me quite a while. His office said pay him instead of the credit cards but it is not really that simple.....we were at the point of charging groceries, gas and other essentials in order to make cc payments. Just learning to live on 100% cash budget so there really is no extra money yet!

How have you all been able to deal with this....I want to get going so I can start a new life without cc's.

[chicagoannie]

Hi - How complicated is your filing? Do you know if your Ch 7 will be a no-asset case?

[chicagoannie]

Oh, I meant to also ask - have you been sued yet? Do you have any judgments yet? Are your wages being, or set to be, garnished?

[keepmine]

Assuming you've done what your attorney suggested and stopped paying all debt you wish to discharge -you need to find a way to raise some cash.
You won't be the first person who sold off personal property or used a tax refund check to pay legal fees.

[Waited2long]

Chicagoanie....just stopped making my cc payments last week. So not being sued, etc. I'm not sure if it will be a no asset case. House can be exempt and we are current on the payments. House is actually quite affordable. May lose car.

Keepmine....you're right, time to bite the bullet and get creative to get the cash.

[tobee43]

Brought my attorney all the paperwork he needed (pay stubs, tax returns etc). Said it all looked good for a chap 7 and maybe file in a few weeks. I asked about cost and he explained his fee and filing fees etc. Hearing that I told him I probably would have to take an early distribution from my 401k to pay him. He said don't do that it is exempt. I will put you on the installment plan. Two days later I get a letter to sign to retain him and a request for $500.00 to go forward. It also explained that his full fee would have to be paid before he will file. I understand why I need to start paying but it will take me quite a while. His office said pay him instead of the credit cards but it is not really that simple.....we were at the point of charging groceries, gas and other essentials in order to make cc payments. Just learning to live on 100% cash budget so there really is no extra money yet!

How have you all been able to deal with this....I want to get going so I can start a new life without cc's.

ours was a no asset 7..we had some complex issues, however, it took us over a year and a half to pay the atty.....two years to file date!

(however, we actually went underground...LOL!! and after 33 years left the state and left no forwarding address or phone...so we were able to hold them off).

our atty worked very well with us, both of us lost our jobs, we had nothing left and just made monthly payments until we met the new state limitation of filing and the firm was paid in full.

good luck to you! i wish you the best, and know this is difficult, but you WILL make it through. promise..

[Unibrow]

Do you make enough a month to cover all your basic expenses once all your debts disappear? If not, filing bk might not be in your best interest right now. Filing will clear your current debt, but if you rack up more after filing, your stuck with it for another 8 years. Think monthly expenses and possible medical emergency.

You will probably have 6 months before any law suits come your way, even then it takes another couple of months before garnishment comes your way. Make sure to make full use of this pre-planning period. The most important thing I did was reduce monthly living expenses. I didn't realized how much money I was wasting on basic living expenses. I make a lot less now then I did then, but I am able to safe a lot more than before. Get a part time job if you can but make sure you're still under the radar. Good luck on your journey.

[Jacey]

To me the most painful and educational part of this process is living to learn on cash only without the "safety net" that credit provided. It's a tough transition, and we did it the hard way by paying the lawyer in 2 months to get filed quickly. The debt payments go toward the attorney and the groceries. If your minimum payments were high enough, it doesn't take long to accumulate some cash for the lawyer. It was tough for us for 2 months, especially since we started parting ways with credit prior to Christmas with 3 kids. Not enough time to save for gifts, pay a lawyer and eat, but we managed and you can too. Crack down and live like you have your last dollar in your hand.

[tobee43]

To me the most painful and educational part of this process is living to learn on cash only without the "safety net" that credit provided. It's a tough transition, and we did it the hard way by paying the lawyer in 2 months to get filed quickly. The debt payments go toward the attorney and the groceries. If your minimum payments were high enough, it doesn't take long to accumulate some cash for the lawyer. It was tough for us for 2 months, especially since we started parting ways with credit prior to Christmas with 3 kids. Not enough time to save for gifts, pay a lawyer and eat, but we managed and you can too. Crack down and live like you have your last dollar in your hand.

great point, and scary, as it may be, yes,we need to live on CASH...only...i know it seems impossible, but it does really happen...it does..

[discouraged]

It took me a while also. I eventually had to quit paying my mortgage as my house is so underwater and I have been unemployed (except for some temporary work) for a long time. It's amazing what you can cut down on when you need to raise that money.

[tobee43]

It took me a while also. I eventually had to quit paying my mortgage as my house is so underwater and I have been unemployed (except for some temporary work) for a long time. It's amazing what you can cut down on when you need to raise that money.

personally, i STILL can't figure out how you're doing it, my friend.

and IF you can...then ANYONE can.

[Waited2long]

Thank you all for your words of encouragement and well earned wisdom! Unibrow....we do make just enough to cover our living expenses and mortgage. I see now I must take advantage of this time to learn how to live even leaner! I think I am too impatient and feel like I am going to be sued or something as soon as my creditors see me miss my first payments ever.
It's like being a kid again....living on your allowance with nothing left to fall back on. I think so, so much money was going to cc payments each month that any small savings in living expenses weren't even noticeable in comparison. Now if we decide to cut something from our budget it will be noticeable and will make a difference.
Isn't it strange that I have to actually adjust to living on what I earn, the way it should have always been? It may take my mind a few weeks to adjust to this new wisdom....I guess you can teach an old dog some new tricks. I guess I just felt like these cc companies would be at my door in a week or two and I didn't have time to save for attorney fees. A few weeks ago I would have just slapped down a credit card!! Sad situation I got my family into so I will work hard to get us out.

[gatekeeper]

Just stop paying the credit cards bills, paid the 500 dollars for the attorney intial fee and then pay month around 100 to 200 or something to the lawyer till you owe nothing. I think all attorneys are willing to work with you in making payments to them. Just stop paying the credit cards, and don't answer the telephone when a bill collector calls. What I did, was vonage had a system in place as to where I was able to block calls by adding each bill collector number to the list. Also, have each creditor remove your work number and any other number such as cell phone, to ensure that they don't call you. What I did was I advised each creditor that my phone number had change, but I had gave them a phone number that went to voice mail only that had a message the detail that I am in the process of filing for bankruptcy, please contact my attorney at 585-555-5555, again thanks. So they never had called my house or work and my cell phone at all. They only had my number to the voice mail box, that was setup for all of my creditors. Also during the nine months of not paying my creditors, I had yet been sued bu anyone.

[discouraged]

Gatekeeper - Even though it is now past the time they are calling (341 on Friday), how did you set it up so your voice mail would do that message? Was that through vonage?

You should post that in the collections thread. I wasn't aware you could do something like that and would have appreciated it. Couldn't ahve done it with my regular answering machine as I am constantly looking for a job but sure could have used it as a diversion for creditors.

[discouraged]

One of the things that has saved me a ton of money is by having a vacuum food saver. I am able to buy things when they are on sale, especially the two for one's and freeze the extra. Also, I am a thrift store junkie but have learned through the years how to spot the quality items. I just paid 5.99 for a pair of New Balance tennis shoes that look only slightly used. I also bought a small tv for 4.95 at a thrift store. The faces are a little orange but who cares?

The only things I buy new are computer items - keyboard, monitor, etc. and the food saver, because I figure if someone got rid of them, there is a problem with them. Otherwise I have had good luck with a coffeepot, crock pot, etc. And you can't beat the price of clothes!

So, watching for sales, remembering to clip coupons (and using them) and going to thrift stores has been a life saver for me.