What all happens?

[jvm]

Hello i will be honest i dont know much of anything about bankruptcy.

Here is our situation, monthly income is $4013.72 this is based on the past 6 months which inclueded some overtime //now overtime is not allowed.(before taxes) bring home is around 2400.00 per month(realistically today)

we are a family of 5 living in georgia

Our monthly expenses which are utilities, minivan payment, mortgage, car insurance, tithes, child support, cc and furniture store account= 2052.00 minivan payment is 368 per month (this is actually what we cant afford, but we owe 16666,000. and have tried selling with no luck)

CC is 2 months behind currently at 221.00 per month with a balance of 2100.00

Badcock Furniture is at 145.00 per month with 2600.00 balance left

Mortage is 478.00 per month (with 27 years left)

By the time we pay all of our bills, and gasoline for hubbys car for work/we dont have enough money for groceries...at least not to get all we need.

we have a baby so there is a clothing expense. and diapers and a kindergarten. who also needs clothes every 6 months at least.

We know we have made foolish financial choices. now we just want relief. if we qualify for chpt 7 what happens? do we loose our home? I dont care about loosing the van as long as we dont still have to pay back or it wouldnt make sense to do a banckruptcy..

Do we have to sell anything in our home ie furniture, electronics?

Also wanted to add that i dont/cant work because of hubbys hours, i wont have a babysitter. And he cant look for 2nd employemt becuase where he works doesnt allow him to work anywhere but fast food, and his availability isnt what they want.

[AngelinaCat]

Hi jvm: welcome to the Forum!

First of all, read all of the 'stickies' in the CH7 and CH13 and the General BK Talk boards. Educate yourself as much as possible about the process. It will be confusing as all get-out at first, but the more you read, sooner or later it will become clearer.

Next, let's see if we can do something about your expenses. Go to some used furniture stores and see if you can replace some of this very expensive rent-to-own stuff, with something that you can pay for outright and get rid of that payment.

'Hub and I once furnished an apartment completely out of the green-box dumpsters in the apartment complex. And they were nice, clean items, too. I hated to leave them behind when we moved back home.

[jvm]

how would i do that exactly? im not doing rent to own, if i return it they will sell it for cheap then i will have to pay the difference. i opened a revolviing line of credit with them. and how would i buy more ..if i cant afford to buy anything else?

[kornellred]

Hello jvm - it might be advisable for you and your husband to sit down with a bankruptcy attorney and discuss what is possible in your case - and then come back to the forum and compare notes (so to speak) with others in your situation.

The complication in your case, if what you wrote is the total debt situation, is that most of your debt is secured. You say you only have $2100 in credit card debt - that is practically nothing in terms of average unsecured indebtedness.

It is likely that your credit will suffer even if you do not file for bankruptcy, since you are later on your cc payments already. You should check out the food stamp program in your state - a family of 5 with your stated income might be eligible for assistance. It's no shame, and it is very discreet and done with an EBT card so no strangers will know your status when food shopping.

I know this is irrelevant, but you say you are in Georgia but the state you registered with the bk forum says Hawaii. Big difference!

[AngelinaCat]

how would i do that exactly? im not doing rent to own, if i return it they will sell it for cheap then i will have to pay the difference. i opened a revolviing line of credit with them. and how would i buy more ..if i cant afford to buy anything else?

I would cancel everything, and have the store come and pick it back up. Meanwhile you will have a few days of wriggle room. You can make other arrangements in the meantime. And it doesn't have to be brand new. Clean and serviceable is what you want.

Now, if you do decide to keep the furniture, do NOT sign a reaffirmation agreement, otherwise there will be no point in you filing. You will still be on the hook for this debt.

[bcohen]

The best option with regard to rapidly depreciating secured property is to redeem. You would file a motion with the bankruptcy court offering a reasonable valuation for the used furniture (such as 20-25% of its original retail price) and if the judge accepts your valuation, you pay that amount and the so-called "security interest" is released. Used furniture is practically worthless, and although some companies do repossess when a debtor defaults, they typically do this out of spite, and usually scrap the furniture rather than resell it.

NOTE--that this only applies if you file for bankruptcy, and I am not saying that bankruptcy is in your best interest at this time.

[jvm]

Hello jvm - it might be advisable for you and your husband to sit down with a bankruptcy attorney and discuss what is possible in your case - and then come back to the forum and compare notes (so to speak) with others in your situation.

The complication in your case, if what you wrote is the total debt situation, is that most of your debt is secured. You say you only have $2100 in credit card debt - that is practically nothing in terms of average unsecured indebtedness.

It is likely that your credit will suffer even if you do not file for bankruptcy, since you are later on your cc payments already. You should check out the food stamp program in your state - a family of 5 with your stated income might be eligible for assistance. It's no shame, and it is very discreet and done with an EBT card so no strangers will know your status when food shopping.

I know this is irrelevant, but you say you are in Georgia but the state you registered with the bk forum says Hawaii. Big difference!

First off thanks for letting me know about the state. i must have scrolled down a notch. We have tried filing for foodstamps. We were denied. I know 2100$ isnt much of a credit card debt but each month it grows becuase we cant pay it. we have stopped paying it to buy groceries. We have even been to a food bank. We make enough to pay all our bills..but it doesnt leave us much for groceries at all. My husband just barely gets by for gas money for work. i do what i can to make things stretch..but if anything comes up like a dr copay or if the car needs an oil change...we have to take it out of grocery money. We should of never signed on with the van. thats whats hurting us. if we could get rid of that we would be ok. But ive tried selling and i cant seem to sell it. I called a lawyer today, they were supposed to email me a packet , but i never recieved it.

[jvm]

I would cancel everything, and have the store come and pick it back up. Meanwhile you will have a few days of wriggle room. You can make other arrangements in the meantime. And it doesn't have to be brand new. Clean and serviceable is what you want.

Now, if you do decide to keep the furniture, do NOT sign a reaffirmation agreement, otherwise there will be no point in you filing. You will still be on the hook for this debt.

Do you think the furniture store will come after us for the balance if we return it?

[keepmine]

How upside down are you on the van?
That seems to be the crux of your problem.
Yes, you could surrender the van in bk and have no responsibility for a defeciency balance or, you could see if a 722 redemption will work as somebody suggested with the furniture.

[Drazil65]

Hi and welcome. You need more income period. You say you don't/can't work but have you maybe thought about babysitting since you are home with a baby all day anyway? One or two children can bring in $100 to $200 a week (or more depending on the area) and that would be an extra $400 to $800 a month. Or maybe something else you do either at home during the day or maybe you go to work in the evenings when hubby comes home. You do what you need to do as a family even if you cleaned offices in the evening after your hubby came home, its hard but it will get you through.

In the mean time I agree with the previous posters about reading everything you can here on the forum then read it all again. Good Luck.

ETA: I agree the van is an issue and needs to go, do some research here on the forums and seek out some similar situations that may help.

[jvm]

How upside down are you on the van?
That seems to be the crux of your problem.
Yes, you could surrender the van in bk and have no responsibility for a defeciency balance or, you could see if a 722 redemption will work as somebody suggested with the furniture.

We owe 16666.00 on the van its a 2007 odyssey. i will look into the 722 redemption..i dont fully understand so will look that up now.

[jvm]

Hi and welcome. You need more income period. You say you don't/can't work but have you maybe thought about babysitting since you are home with a baby all day anyway? One or two children can bring in $100 to $200 a week (or more depending on the area) and that would be an extra $400 to $800 a month. Or maybe something else you do either at home during the day or maybe you go to work in the evenings when hubby comes home. You do what you need to do as a family even if you cleaned offices in the evening after your hubby came home, its hard but it will get you through.

In the mean time I agree with the previous posters about reading everything you can here on the forum then read it all again. Good Luck.

ETA: I agree the van is an issue and needs to go, do some research here on the forums and seek out some similar situations that may help.

We have tried the extra work idea. Heres the thing..i dont have a drivers license (never have) plus I am a nursing mom. Also my husband leaves the house at 145pm and gets home at 230am sleeps till 1100am. So that doesnt leave anytime for me to work for him to watch the kids. I have tried seeking employment on the days hes off (sat sun mon) i put in some apps and even spoke to a distric manager...but with my availabiltiy being so narrow ...no one wants to hire me. The babysitting thing i have looked into...my friend does it..so far havent found or know anyone who needs it..

[LadyInTheRed]

We know we have made foolish financial choices. now we just want relief. if we qualify for chpt 7 what happens? do we loose our home? I dont care about loosing the van as long as we dont still have to pay back or it wouldnt make sense to do a banckruptcy.

Most people don't lose their assets in BK unless they give up secured property because they don't want to keep making payments. So, if redemption isn't a good option, you could give up your van in bankruptcy and the debt would be discharged. Whether you can keep your home depends on how much equity you have in it and what your state's homestead exemption is. If you have too much equity in your home to keep it in a Chap 7, then you could either consider a Chap 13 or forget about bankruptcy and sell your home to pay your debts.

I suggest you stop paying on the van and furniture so you can feed your family. Let them repo both. Find some used furniture as AC suggests. Try craig's list. Set a budget that allows you to save some money and stick to it. Keep looking for babysitting jobs. Is there a church bulletin board or newsletter where you can advertise the availabilty of a stay-at-home mom to babysit? How about bulletin boards in cafes, laundromats and other public places?

You may get sued by the car lender, furniture store or credit card company. But, you also may get an opportunity to settle the debts if you've are able to save enough cash. If you can't settle or earn enough income to pay off the debt, you can file BK after you get sued. By that time, you hopefully will have learned to live within your means without using credit so you can get a good fresh start. In the meantime, do keep reading here and consult with a couple of attorneys to get a good understanding of how the process works.

[Pjmax]

I don't want to open a discussion on religion, but you mentioned tithing as a monthly expense in your first post. I sure hope it's not 10%. If you are tithing before feeding the kids, there is something wrong there. If you feel strongly about this, maybe a talk with your minister might help?

[Pjmax]

As far as selling the car, I'm guessing it's value is nowhere near what is owed, so selling it yourself would be difficult or near impossible, unless you sell it at a loss and have the cash to make up the difference to the finance co, which I know you don't. I would consider voluntarily repo'ing it, if you just stop paying it, they will probably repo it by the 3rd missed payment anyway, and you will probably have a sizable deficiency after it is sold at auction, just so you know. So it's kind of 6 of one, half dozen of another, sort of. Voluntary repo will delay the phone calls for a bit.

I agree with stop paying the furniture and let them repo it. What items are included here that you can't live without, or can't inexpensively replace if you do need it that bad.

You will eventually have to deal with the deficiencies, either by filing BK or working out a settlement that maybe you can afford later, but feeding the family should come first, and it will buy you some time.

As for the kid's clothes, try resale shops, every community has at least one!