Should we move forward?

[lala]

I'm glad I found this forum. Here's are situation...

Family of 4

70K in credit card debt
410K 1st mortgage ($2807 per month)
54K second mortgage ($513 per month)
House worth somewhere between $490K - $510K probably (zillow say $557K, but not sure it would really sell for that.
Student loan payment of $243 per month (about 35K)

Total take home pay per month about $6360 (after taxes, etc).
Total debt payments including mortgage and minimum monthly CC payments $5038. Health insurance $300 per month (plus any deductibles if we see the dr.) All other expenses about $2300 (gas, groceries, car insurance, life insurance, utilities, etc..)

Have 2 cars, both paid off. One is 1999 (probably worth a couple thousand) and the other is a 2007 which we bought for $17K (maybe worth 8-10K now?)

Have a 401K with about 42K and my husband has some deferred compensation and other pension through work, not sure how much.

Probably should sell the house, but that would suck! Would bankruptcy suck more? The only ways I out I see are to sell the house or file for bankruptcy. I can also get another job that might bring in $1000 more, but then there would be child care expenses.

Everything is current except one CC which is now 30 days past due.
We've been robbing Peter to pay Paul.

Appreciate your thoughts and comments. I need a light at the end of the tunnel.

[lala]

Hi All, it's the original poster. When I started doing research on bankruptcy I thought Chpt 13 was the only way to save our house. After reading these posts, I'm not sure that's true. Now trying to get more info on Chp. 7. I did call 2 lawyers yesterday. One has not called back and one seems good. She said it would be a $250 fee for the initial 1 hour consulation. I'll probably make more calls today.

We can't meet with anyone at the earliest until week after next because my husband is on a business trip next week. Just hungry for information so doing lots of reading.

Our concerns right now are some of the same issues that got us into this mess. Worried about what people will think it they find out? Will they find out? Will my husband's employer find out? How will it affect our live in general?
What will we be able to keep?

Thanks for listening. Any thoughts/info are appreciated.

[LuciluS]

If I were in your shoes, I would set up some free consultations with several Bankruptcy Attornies. Put what you stated in your post on a Spreadsheet (Your Gross Monthly Income vs. your Expenses (don't forget Property Taxes divided by 12 mths, avg. mthly medical out of pocket expenses, etc.) along with what Taxes are deducted from Paycheck). Do not include in this specific Accounting the amount you are paying in Credit Cards. I would list the Credit Cards, total amount owed & monthly payments separate, as your Credit Cards will most likely be discharged if you are able to file a Chapter 7.

Zillow is useless in determining the value of your home. I would go to realtor.com and on that link it will say 'whats the value of your home' or something similar. Type in your address, City, State. You will be able to see what homes have recently sold in your neighborhood (if any) or it list some other info. I added up the total dollars sold and divided it by the total square footage of the homes sold (in my case..last home sold was Oct. 2008, so I also looked at homes for sale & included them). I took the sq. footage of our home and multiplied it by that number. Not the best estimate, but enough to give you an idea to give the Attorneys'. Also, list the 'Principal' amount owed on your home if you can find it. I have an Amoritization showing each month what amount is Principal and Interest.

Take an accounting of your Personal Property (i.e. furniture, clothing, lawn mower, etc.) and use what you think it would sell for in a Garage Sale. You don't have to go into a lot of detail for Consultations, but it will help if you have some sort of value. Go to Nada.com & find out what the Value of your vehicles are. If you own it outright, then the Value is an Asset. If you owe on it, list the 'Principal' amount owed.

Look up your State Bankruptcy Laws and see if they allow you to use Federal Bankruptcy Laws or if they have specific data. You might can type in your City, State and then Bankruptcy Districts and it will probably direct you to the specific website which should give you a lot of information to help you.

I would do what I highlighted first as it will help you in doing the other things I listed.

Luci