Please help me get started

[NewHere]

As the name implies, I am new here. I am married, with a toddler and another on the way. I was laid off as of the first of the year. While we made great money last year, things are much different now. I was the major breadwinner in our home before my layoff. My husband's paychecks have been less this year as well, because of cutbacks in his industry.

We have a house and family vehicle, both of which are current on payments. I don't want to lose either of these, as neither are extravagant, but work fine for our family of four.

We have about $47,000 in debt of credit cards and a few small medical bills.

We looked into a debt consolidation program but with out present income, we don't qualify. If I were able to go back to work, or find a new job, things would be different on that front, but no telling when that will happen.

I'm scared we won't be able to provide food/diapers/necessities for our children if we don't follow through with a BK but I don't know what else to do, or where to start.

Please give me some guidance, where should we go from here?

[backtoschool]

As the name implies, I am new here. I am married, with a toddler and another on the way. I was laid off as of the first of the year. While we made great money last year, things are much different now. I was the major breadwinner in our home before my layoff. My husband's paychecks have been less this year as well, because of cutbacks in his industry.

We have a house and family vehicle, both of which are current on payments. I don't want to lose either of these, as neither are extravagant, but work fine for our family of four.

We have about $47,000 in debt of credit cards and a few small medical bills.

We looked into a debt consolidation program but with out present income, we don't qualify. If I were able to go back to work, or find a new job, things would be different on that front, but no telling when that will happen.

I'm scared we won't be able to provide food/diapers/necessities for our children if we don't follow through with a BK but I don't know what else to do, or where to start.

Please give me some guidance, where should we go from here?

Welcome Newhere!

Qualification for chapter 7 is based on the last six months of income, so if you were laid off in Jan, then you should probably be under the median income by now. What you get to keep in a chapter 7 is based on your state's exemptions, so we would need to know what equity in the house and cars are and what state you live in, to figure out if you will be able to keep them in a chapter 7.

The first thing to do is find out where your family income looking back six months is in relation to the median income and do your means test. Here is a link to the site where you can find this info:

http://www.usdoj.gov/ust/eo/bapcpa/20090315/meanstesting.htm

After you figure out where you stand, then its time to start interviewing lawyers. It makes sense to talk to several of them.

I don't want to overwhelm you in the first post, so that's all for now.

[NewHere]

Thank you so much for your post. Though, what you said all seems a foreign language to me at the moment. I went to the one link for Bankruptcy Allowable Living Expenses and for three people (since baby is not here yet), with mortgage, for our county is $472. I don't know what that means exactly though.

Also, our family vehicle is a 2004, we've had about one year. Payments are current. We own outright a 90something pickup with a huge amount of miles, but it is a regular cab and we can't safely take our son in it, and can't even think about fitting in there as a family of 4. This has been my husband's work truck for five or six years.

[backtoschool]

Thank you so much for your post. Though, what you said all seems a foreign language to me at the moment. I went to the one link for Bankruptcy Allowable Living Expenses and for three people (since baby is not here yet), with mortgage, for our county is $472. I don't know what that means exactly though.

Also, our family vehicle is a 2004, we've had about one year. Payments are current. We own outright a 90something pickup with a huge amount of miles, but it is a regular cab and we can't safely take our son in it, and can't even think about fitting in there as a family of 4. This has been my husband's work truck for five or six years.

What state do you live in? We can help you figure your allowable expenses and the median for your state if you let us know what state you live in.

[frogger]

Welcome. Start reading the sticky posts and they will help you get a good understanding of what's going on. Good luck.

[NewHere]

What state do you live in? We can help you figure your allowable expenses and the median for your state if you let us know what state you live in.

Iowa

[adviceplease]

I feel for you we are down one income and I worry about all the expenses to raise our child. I would try angel food ministries (online) for food and call United Way and the can give you info on food shelters and maybe where to get diapers. Have you applied for WIC? Seeing as the loss of income and a new baby on the way you probably will qualify. As for the bankruptcy sit down and write out several months of spending without the debt in and see how much extra you will have and go from there you may be surprised at how much money you are still going to have for basics after the CC's are gone. Good luck!!

[backtoschool]

Well it looks like Iowa has an unlimited homestead exemption, so your house will be exempted.

The median income for 3 people is $63,888. (this may be last years number, I am not on the official census site) so if your income is under that you pass the means test automatically.

Iowa has pretty standard exemptions. You get several thousand for appliances, several thousand for clothes and household items, (I am assuming this can be doubled since you are both filing), a $5,000 car exemption which is for cars OR tax returns (but only $1,000 can be used for the tax return).

My guess is that your personal stuff will fit into the exemption amounts, because the exemption amounts looked pretty normal, and your home is totally exempted.