Very new, and looking for some input.

[Tiptoeingbk]

Hello everyone,

I just registered today, but I have been visiting the forums often for a while, scouring for useful information and there is a ton here. I wanna thank anyone who takes the time to read and respond to my post, it is much appreciated. =)

My boyfriend and I have been together for almost 11 years, and up until 2009 we were doing good, then we had to relocate an hour and half away for his job. I was forced to quit my job, being as he made the majority of the money and the commute was too long to make for either of us, our car is not in the best condition. In December of 2010 I was laid off of the part time job I got when we first moved and have been claiming unemployment since I left my old job in 2009. Things have been getting tighter and tighter ever since and my unemployment is going to run out in a few months and the job market in this town is terrible, its the third worst in the country from what I hear. We have about $15,000 in credit card debt total, about half of it is only in my boyfriends name, but we have a loan from bank of america for about $7k that is in both of our names. We have been on a debt management program since august of 2010. We are paying them $431 a month and have paid off about 2,000 since we started the program, but we are struggling to pay this amount and keep up with rent, utilities, and insurance and still have enough to buy groceries and such. I have been looking into bankruptcy for a little while but it is very scary. One thing I see being a major issue is the fact that we don't use bank accounts.(can you file bk without a bank account?) We have always paid everything in cash or money orders. I have been thinking about 2 different directions we could go. The first is to stop payments to the dmp, open a bank account and start paying all expenses through that and have my boyfriend file the bk, and pay off the bofa loan after. The other is to stop payments on the dmp save up the extra money, wait for garnishments and pray to god I find a job before they start. Right now he is only making $750 every 2 weeks and in California they are allowed to garnish up to 25% of his wages, roughly that would be about $325 a month, which is lower than what we are paying to the dmp. I'm afraid to do this mostly because I have no idea if I could find a job in time. We make about $1,900 a month combined, which is about $600 under the median income for california so I'm pretty sure he would pass the means test and we have no other property that is of any value. I just want to make sure we are taking the best direction we can, because I know we cannot continue to get behind on other bills to pay off this debt, it's very stressful and I need to do something soon, otherwise I'm going to lose my mind lol.

I understand no one can give any real legal advice, nor would I act on any given without talking to a lawyer first. I am only looking for what anyone might do, being in this kind of situation. Any input would be very helpful, Thank you again and I hope everyone has a wonderful day.

[keepmine]

To answer the question about a bank account. Nothing in the bk code requires you to have a bank account. You just list cash on hand on the petition.
I'd suggest that, you really think long and hard about filing bk over $15K. Your problem isn't debt but, lack of income. If the DMP is working, I'd sugest your BF start looking for a pt/weekend job and you redouble your efforts to find work. Just hang in there-all you need is a little more cash coming in.
Even if you file bk, I doubt you could support yourselves going forward on $1900/month in a state with a high cost of living.The object of a bk is to improve your situation going forward. It's hard to see how you're making progress if you're still living paycheck to paycheck. Plus, unless you file pro se your BF is looking at $1500+ for legal fees.Money that could make a real dent in your debt.

[Tiptoeingbk]

Thanks Keepmine, I'll take what you said to heart. I know 15k isnt bk worthy, but with my ui running out I'm heading into panic mode. I guess I'm grasping at straws, If I can't find a job soon, I have no idea what else to do. I have to say living paycheck to paycheck without debt sounds a lot better than doing it for the next 4 years with debt and not being able to pay all the bills on time. Appreciate your time though and take care. =)

[Drazil65]

Hi and welcome, I have to agree with keepmine that perhaps your focus should center on adding income and not filing so soon. Have you thought about doing things from home like daycare? I know plenty of people that pay alot of money a week for decent daycare and if your home anyway at this point it could turn into a good paying job. Also, running an ad for residential cleaning, even if you start in your apartment community or neighborhood could be another way to get back in the game quicker. You may be able to actually get your own business going by just running an ad or putting up flyers. Just some thoughts that might actually produce something. When my husband first got laid off back in 2009 he cleaned office building at night so that he could focus on finding a job during the daytime until he finally found something. I know its hard (all too well) but if you can think outside the box you might even like what you find. Good luck to you!

[Exployer1234]

I understand your frustration. It is hard now days in all aspects to keep up with the rising cost of things, plus the average persons income keeps going down. It is a losing battle. I would try to find a way to bring in extra money. 15K is not much when it comes to BK, and in the end it is only going to do away with past debt, but it will not improve your situation or give you any extra money. I hope you find a way to get extra money in.

[tobee43]

first welcome to the forum!

i also agree with keepmine as always, excellent advise.

i know tho, increasing income today, is indeed, not that easy. so i would suggest cuts... before you drop your DMP, if they are working well for you, call the DMP and tell them your situation has changed and you need to recalulate your payment. can you move into less expensive housing? i know that doesn't sound great. but i know for us, our downsizing alone with respect to our living space has really been an aid on restoring some money on the plus side of the paper, for us, anyway.

since you are under the income median, maybe you can get some assistance. i understand my towns, cities and states have cut budgets in the social services, but there may be something out there to assist you, even if it's with your food costs?

best of luck! and keep posting and let us know how you make out!

[BKAttyMI]

Another thing to consider, since you are not married, it wouldn't be a "we" bankruptcy, it would be a you or him. If you have any JOINT debt, a single case isn't going to fix that problem. It will just transfer liability to the other person. I agree that you need more income coming in before filing.

[Tiptoeingbk]

Wow, thank you to everyone for some great ideas! I would love to move to a cheaper/smaller place, the only problem is moving costs but I have already been looking into that. I'm going to see what I can do with some of your other suggestions. I have tried for assistance and we are slightly out of the brackets for our area, but maybe not after my UI runs out. I don't know if the dmp is working well for us, It's working in the sense that they make the payments for us and I don't have to deal with sending individual payments, but for the last few months we have not been able to make the full payments. I asked about having them restructured and they told me they are as low as they can get them already, so no luck there.

BKattyMI - Our initial thought was to have him file bk alone to take care of the debt that is in his name alone. We only have one account we are both named on, so I was thinking we could continue to pay that one after a bk, but we have ruled out BK based on what I have learned from the forums and the responses here. I agree completely that we need more money coming in, but it is much easier said than done. Evidently I am not as creative as some of the people here

I don't like the fact that if we allowed the accounts to default and the creditors obtain a judgement they would be taking less than we are paying now, although not by much I suppose. What are the draw backs to doing this? I'm sure there are many... anyhow, thanks again to everyone. It has been a real help to get insight from people who have been in a similar situation. Take care!