Newbie Here...

[klynnmc]

Hi,

I have recently made the decision to file for Chapter 7 bankruptcy. I stumbled upon this forum, and I would like to share my story, hoping someone has a similar one. I'm 28, live in a very very very expensive part of the country, and racked up $20,000 worth of credit card debt since I was in my early twenties. How? I'm not too sure. But I wasn't blessed with a great career, even though I have a college degree. Even though I was never late on payments, a bad year career wise (a company lay off, and then a bad career move) led me to start being late. As if I wasn't struggling enough, the late payments led to higher interest rates, and higher payments.

At first I was determined to get out of debt. I've been living with my parents this whole time (which is BECAUSE of this evil debt), and I figured, how can I NOT do this? I don't have a mortgage or kids. However, I couldn't do it. I tried doing it for awhile but my entire life purpose was to pay off this debt and I lost who I was. I cried every night, was miserable all the time, watched all of my friends get married, buy houses, and have kids, and all I did was pay off this monsterous debt with my mediocore salary.

I was once a free spirited girl who had dreams and knew what she wanted. Suddenly I felt like a failure who couldn't afford to buy new underwear. Then....something happened.

I got pregnant with my long term boyfriend. We were going to abort the baby because of the debt. (Can you believe it? lol), and then I sat down, did some soul searching, and said...NO. I'M Done! And I called up a bankruptcy lawyer. I decided that I didn't care about the stigma of bankruptcy. Credit cards have ruined my life up to this point and I'm no longer going to let it happen.

Interestingly enough, I had no benefits at my $45K per year job (i was an executive recruiter), and in order to get benefits I had to quit my job in order to qualify. Thankfully, my boss was understanding enough to "fire me" so I can collect unemployment and I was able to get govt benefits for prenatal and delivery.

If you saw pictures of me you would be shocked. Here I am, a white collar bred, suburban, college educated, former cheerleader sorority girl, who NEVER imagined using WIC checks, collecting unemployment, and filing for bankruptcy. It's VERY HUMBLING.

Luckily, I have a supportive family, fiance, and future in-laws. My fiance's mom is renovating her itty bitty tiny intsey weeny country cottage for us to live in until we get back on our feet. By the way, my fiance is a starving artist type but thankfully NOT IN DEBT (thank GOD).

As I write this at 3 months pregnant, I am trying to get my career back on track (it's hard in this job market) before I start showing, and paying my lawyer, and not paying my credit cards anymore.

I understand that I am embarking on a new life here and possibly a clean slate, but there are moments of despair when I say "what happened to me? I'm a good person." And of course, it all boils down to those STUPID CREDIT CARDS. My unemployment check pays enough for food, gas, my cell phone, and my car payment. I'm using my tax rebate to pay my lawyer. Sometimes I just want to break down and cry.

Did anyone ever feel this way? Will things get better after bankruptcy? If this isn't rock bottom then I hope I never get there.

[Flamingo]

I have two daughters a bit older than you and one several years younger than you and am a full time professional myself and have seen it all. I commend you for trying to do it yourself; as you have found out, short of Uncle John leaving you a nice inheritance by surprise, it would take you a while to clean up that debt. I do want to point one thing out to you - a Chapter 7 will be on your credit reports for 10 years from the day you file. Some people have no problem with that and seem to get all sorts of credit shortly after discharge but others suffer for years trying to get approved for credit or for a mortgage. It appears you have supportive family around you and that is what is going to help you out the most and get you back on your feet. Count your blessings - many people don't have that to fall back on.

The other thing that could work against you filing is getting a decent job. The job market is bad anyway right now and the competition fierce. Background and credit checks are the norm and you can bet your Chapter 7 will loom in front of them. It is more of a concern if you attempt to get a job with a financial institution or any place where you might have access to accounts or handle money. BK's stigma, no matter who you are, puts one in a place with an employer of a higher risk of embezzlement or theft from the company. Many places just will not hire you with a BK on your record. If you suspect it might be an issue, be forthright with an employer during an interview and explain what happened and how you learned from it and it made you stronger and more determined to shape your life and do better.

You are doing a total lifestyle change with your baby and boyfriend. Make it financial as well and take the next several years to find a good job with your degree and go to your parents and to your in-laws to be and thank them for their help and understanding and you will always be there for them.

[lrprn]

Flamingo is more discouraging about the post-filing period than most of our Ch 7 filers here have experienced.

It's against the law to not hire someone solely because they filed bankruptcy (although if you are in HR, you know that a company can manufacture an acceptable reason not to hire if they wish). However, unless you work in finance or in a position that requires a security clearance, many employers don't even check a credit report. They won't know you filed unless you tell them during the interview (and most will suggest this is a situation for not volunteering but not lying if asked directly either).

Do some searches here in the forums. You will find many threads with wonderful stories of many Ch 7 filers who say it's the best thing they ever did for themselves and they wish they had done it years earlier.

Most Ch 7 filers find that two years after discharge, if you keep your post-filing credit report squeaky clean with on-time payments for everything, you will start getting financial terms almost as good as those who never filed.

You are making a business decision, nothing more - the same business decision that your creditors made when they jumped your interest rates and penalties to the point you could not pay them no matter how hard you tried. You did what was best for your future to get out from under a debt you could never pay back no matter what you did. That's what the founding fathers intended when they kept bankruptcy as a part of our original US laws.

Very few of us ever thought we would file bankruptcy - quite the opposite. Most of us came to it as a last resort when we realized there really was no other option just as you have. Welcome to a large group here who've all been where you are right now. We understand the difficulty getting to the decision, the shame of having to do it, and the relief of finally having made the decision. As time passes, I think you'll come to feel as almost all of us have that's it's the best decision you ever made.

[DivorceRuinedMe]

Hang in there girl. You are NOT a failure. Crap happens and we learn from it and move on. Nothing at all to be embarrassed about. Heck, I'm only a few years older than you (30) and I have 2 kids, I've been divorced and now I'm remarried with 2 more kids for a total of 4 kids all under 6! I'm a fulltime Mommy to my stepkids as their mother abandoned them and moved all the way to the other side of the country! I support us all on my semi-decent salary and child support (deadbeat mother pays NOTHING) and my hubby stays home with the little ones as daycare would KILL us! I never in a million years thought I'd be divorced, remarried, filing bankruptcy with 6 mouths to feed all on my shoulders but heck - life is what you make it. And I'm going to make this life worth every minute. I am not ashamed of what happened to me. Life happened and I'm a SURVIVOR.

I'm proud of you for keeping that baby as I know that it's such a rough thing to do when it's an unplanned pregnancy. Right there tells me that you are a survivor too. So pull up those boot straps and stand tall. And don't let this get you down. Let it bring you up!

[klynnmc]

Wow. Thanks sooooo much for the encouragement. I know all the pitfalls. The job, the apt, the car, ect. But I looked at it this way....I'm IN HR. I'm actually career switching from agency recruiting to internal human resources. As an agency recruiter....RARELY would they pull a credit report. So if I happen to get a job where they pull a report, and I don't get hired, I'm sure I will get hired somewhere else. The apt/house thing: Well, that's a whole other story. As I mentioned I live in the suburbs of NYC. I think we are ranked as THE most expensive place to live only second to Beverly Hills, CA. Do any of you want a run down two bedroom in an industrial area for $2500 per month? I know where to find them! lol. EVERYONE struggles around here on some level. Thankfully my future in-laws are nice enough to let us live in their house that no one no longer lives in. Like I said, it is SUPER DUPER TINY. A two bedroom, with a small kitchen, living room, and bath. But it will work for the next couple of years. When the baby gets to be older we will have to figure something out. By then hopefully bankruptcy will be two years history, and me and my husband will have normal jobs. He is also doing a career vamp. We will then find somewhere else to live even if we have to move out of NY. Alot of people my age here had to leave because they were simply priced out. Day care won't be a problem as we have family willing to help. I sometimes think I'm so unlucky, but as I write this it seems silly to say that.

One thing is CERTAIN. I AM NEVER USING A CREDIT CARD EVER AGAIN. I have already started to read up on building my life up again after bankruptcy. Because I will never ever have this happen to me. I can't wait to smile as I see my credit report creep up over time. I'm just so impatient, that I want all of it now. Instead, I have to just deal with the whole "feeling like a loser" thing for a few more months.

One thing I read, that helped me, that may help someone here is this: "If you have your health, you can do anything. Money comes and gos, and if you loose it, you just get right back up there in time." I agree with that. Money isn't the most important thing. Sometimes you have more, sometimes less. Bankruptcy EVENTUALLY falls off your report, and live just goes on. I want to use this as a learning experience. And I want to one day be able to write on this board with a bunch of smily faces with the title of the post...FREEDOM!

[Flamingo]

It's against the law to not hire someone solely because they filed bankruptcy (although if you are in HR, you know that a company can manufacture an acceptable reason not to hire if they wish). However, unless you work in finance or in a position that requires a security clearance, many employers don't even check a credit report. They won't know you filed unless you tell them during the interview (and most will suggest this is a situation for not volunteering but not lying if asked directly either).

I am not the kind of person to sugar coat things for anyone - those of us who have filed Chapter 13 and Chapter 7 know the pitfalls it brings and the sun doesn't always shine because you file. While the OP is considering filing Chapter 7, there are good and bad things that follow and since I work with Legal HR and handle all sorts of discrimination and other filings, I disagree with your paragraph above. Most employment applications indicate that when you sign, you are allowing a background check and a credit check on yourself and your social security number is provided. I have rarely seen an employment application without that indicated. You are also usually told during the interview about that and also if they do drug testing. Again, one must know that when they file, that could be a deterrant against getting a good future job. There are also questions sometimes on an application that indicate "Have you ever filed bankruptcy?" Note the "ever." If you answer no, there's a lie right there even if the BK was 20 years ago (which they can find as public records don't disappear as does the information on credit reports after 10 years). While they cannot prove that would be the only factor, it is used especially if you need to be bonded, work with online accounts, handle payroll or checks online or handle cash. A company has the right not to hire you if they don't want to due to a BK and it backs itself up by having that indicated in their company policies about a prospective employee's financial or criminal background. You can be the most stellar employee in the world and get beaten out by the next candidate who has a clean financial record. However, there is a bigger problem if there is discrimination against you due to age, race, sex or religion and you believe you were not hired for one of those reasons.

In this day and age of fraud and embezzlement, more and more background and credit checks are being done on prospective employees. Those that have done the fraud and embezzlement make it hard for good employees who want to get into the company; therefore, even late or no payments on a credit report can raise eyebrows.

That's just the way it is - I believe the poster with her proactiveness and drive will do well for herself. She has a lot of support also and from her postings is extremely intelligant. I only wish her the best but she needs to be cautious to protect herself over the next 10 years as to her personal life with BK on her record and her finances.

[Flamingo]

One thing is CERTAIN. I AM NEVER USING A CREDIT CARD EVER AGAIN. I have already started to read up on building my life up again after bankruptcy. Because I will never ever have this happen to me. I can't wait to smile as I see my credit report creep up over time. I'm just so impatient, that I want all of it now. Instead, I have to just deal with the whole "feeling like a loser" thing for a few more months.

You are not a loser and have never been. Falling in the credit trap has been going on since credit cards came into being in the 1960s. It got worse as time went on with more credit being provided. Stores hawk credit cards at Christmas time outside in the mall saying you should get one and get that big 10% discount off your purchase and then you can pay it off and close the card! How many people do that (close the card?).

My middle daughter who went to a well know, private, University on the East Coast. on a full scholarship, got caught by the credit card vendors at the University hawking Discovery cards, Visas and Mastercards, even though she carried a 4.0 all through high school and we thought had the financial smarts not to fall for that. Trash trinkets abounded on the tables with all sorts of offers if one signed up. She obtained a Discover card and did not tell us about it (this was early 1990s). We started to get phone calls at home about late payments on Discover for her and they would not talk to us because the card was in her name. When we contacted her, she had already run up $2,000 on the card in just a few months by going out to eat with friends, her friends asking her to get them things they could not afford, getting things at the University Book Shop, etc. We were floored. She said everyone was signing up for these cards and getting them cause it opened up a lot of fun and freedom for the young adults and some of the young adults with rich parents would have the parents pay the account (note there were a lot of rich folks at this University and our daughter was there on a full scholarship so did not come from big money). She could not pay it as her weekend job for some of her spending money was not enough to cover those payments and give her the spending money she needed on campus. We took the bill over and paid it down and had the account closed for her. To this day she thanks us for helping her out and has done things over the years to repay us for that $2,000.

Over the next several years, be sure to thank you inlaws and parents for their help and support and best of luck to you on your new baby and new life.

[klynnmc]

Flamingo,

Thanks for not sugar coating things. Just a question though...do you work in a financial institution? The reason I ask is because I have never filled out an application where they asked about bankruptcy. I'm being completely honest. Criminal charges....YES...but not bankruptcy. I DO understand that certain opportunites (jobs, apts, etc) may be unavailable to me due to bankruptcy, but I've rationalized all of it. Here's my list.

1. My credit SUCKED anyway. And it would have CONTINUED TO SUCK. Maybe for the rest of my life. Certainly beyond ten years. Unless of course I had some crazy financial windfall or something. But if anything, it was getting worse, and I had to live paycheck to paycheck, sometimes over drawing on my account.

2. Bankruptcy allows me to keep a terrible credit score, with the opportunity to actually FIX it. Unlike now, where there is really no chance in EVER fixing it.

3. I'm 28. In ten years I'll be 38. And 38 is still considered fairly young. I'll still have a lot of years to buy a house, and travel, and get jobs. Life won't be even close to over yet. Without the bankruptcy I would never have that chance.

4. When you get to the point that I have, where debt is so in control of your life where you can't marry, have kids, and leave the home your parents own, the notion of not getting a certain job with a certain company is really not to much to cry over. There will always be a company that will hire you, bk or not.

5. I'll get a job. I'll get an apt. In fact, my long term goal is to one day buy a home. And I know I can, because MANY MANY MANY people who have gone though what I have gone through have.

6. ANYTHING is better than debt.

[CindyLou]

I agree with all but # 6!!!! There are many thing worse than debt...... It just doesn't seem that way to you now. It's all relative!

But I support your reasoning on why you are going to file!! I agree that if you can "get it together" now, then you will have a nice long financial life ahead!

[Flamingo]

Flamingo,

Thanks for not sugar coating things. Just a question though...do you work in a financial institution? The reason I ask is because I have never filled out an application where they asked about bankruptcy. I'm being completely honest. Criminal charges....YES...but not bankruptcy. I DO understand that certain opportunites (jobs, apts, etc) may be unavailable to me due to bankruptcy, but I've rationalized all of it.

I am a paralegal in a large law firm (that doesn't handle BKs). I worked in the past for one of the "Big 6" accounting firms who had a major financial institution as a client and was a contractor on site (had an office at the financial institution itself). To work there, we had to be fingerprinted and our entire credit and criminal backgrounds checked. Employees were subject to the same. They indicated to all prospective employees or on-site workers that you could be denied employment if you had bad credit or BK on your record. On all my applications for employment, in all but one was it asked if I had ever filed for bankruptcy. Thankfully all these were before we actually filed. Most places now do drug testing, background and credit checks and it is stated right there on the application and/or you are advised at your first interview they will do that. In time you can almost bet 100% that each and every job will require a credit and criminal background check and possibly fingerprinting. This is due to all the fraud and embezzlement taking place and people lying on employment applications to get the job (i.e., adding degrees they never received, attending a college they never went to, etc.). A lot is also due now to illegal aliens trying to get jobs with falsified documents so there will be many changes in the next few years as to the employment process. Employers are trying more than ever to protect themselves, their clients and their other employees. It's just a business decision like anything else. When a company hires you, they hire you to make them money and not to take money out of their pocket. While we know we won't do that, the stigma of BK or bad credit indicates one might. Whether or not anyone likes that, that is just the way it is and they don't have to hire you if they have doubts about you in that respect.

1. My credit SUCKED anyway. And it would have CONTINUED TO SUCK. Maybe for the rest of my life. Certainly beyond ten years. Unless of course I had some crazy financial windfall or something. But if anything, it was getting worse, and I had to live paycheck to paycheck, sometimes over drawing on my account.

2. Bankruptcy allows me to keep a terrible credit score, with the opportunity to actually FIX it. Unlike now, where there is really no chance in EVER fixing it.

3. I'm 28. In ten years I'll be 38. And 38 is still considered fairly young. I'll still have a lot of years to buy a house, and travel, and get jobs. Life won't be even close to over yet. Without the bankruptcy I would never have that chance.

4. When you get to the point that I have, where debt is so in control of your life where you can't marry, have kids, and leave the home your parents own, the notion of not getting a certain job with a certain company is really not to much to cry over. There will always be a company that will hire you, bk or not.

5. I'll get a job. I'll get an apt. In fact, my long term goal is to one day buy a home. And I know I can, because MANY MANY MANY people who have gone though what I have gone through have.

6. ANYTHING is better than debt.

[There is no need to rationalize. You are at a place in your life where you really have no other choice except cancel all credit cards and try to pay down the debt without filing. If you can actually do that in five years, many would state there is no need to file and put a BK on your record for ten years when you can fix it for better credit in less. That's up to you and what you think you will be making as a married couple in the next few years. We all have decisions to make in life - I have always told my kids and anyone who comes to me at work about whether or not they should quit and get a new job - "You do what you think is best for you - don't worry about what anyone else says."

This is a decision for you to make for your life as it stands now along with your future husband and your families. You know your life better than anyone so explaining things to everyone else will get you a myriad of different opinions and confuse you even more. Do what is best for you and be thankful you have family behind you - that is one thing that will make a big difference for you in the long run.[/SIZE]

[gophermn]

klynnmc - hang in there! WE ALL HAVE BEEN THERE. Yes we all have different stories and come from different backgrounds but each and everyone of us had to walk through the doors at the 341 meeting and each one of us had to sit in front of a Trustee.

By doing this you WILL feel a lot of weight lifted off your shoulders and you can begin to concentrate on life, your baby and appreciating the smaller things. Months ago I was in the same boat and embarrassed but today, I know I have controlled my debt, more stronger in my attitude and have slowed life down a bit.

This forum is a great help and there are a lot of 1st class people in here who have walked in your shoes..

Welcome!