How many of you just stopping paying everything?

[nervous1]

I made the decision (after consulting with a BK attorney) last week to stop paying my cc's. "Plan" is to file BK7 after at least 90 days have passed so that I won't have any charges to question. Sooner, if someone starts something.

But....after taking a very close look at my finances (BK has a way of forcing you to do just that), I'm seriously considering not making my mortgage/equity line payments either. I applied for a loan mod a month ago...not feeling too hopeful, but you never know. At least if I don't pay, they'll believe me when I say I'm having trouble making the pmts. (Calling them and asking for help a few months ago didn't faze them.)

So....anyone else just stopped paying everything? (except absolute necessities)???

[Momof123]

I "think" your mortgage has to be current to file a Chapter 7 or are you going to let the house go??

[starr4law]

Your mortgage does not have to be current to file a Ch 7. Whether or not you keep paying on your mortgage is entirely up to you and is dependent on where you want to be in the future. Is your home WAY overmortgaged? Ch 7 would be a good opportunity to discharge any liability relating to the 2nd mortgage (if any).

It is vital that when you file your bankruptcy, that you do NOT sign a reaffirmation agreement regarding a mortgage - especially if you are unsure if you want to keep the home.

Also, keeping or losing the home is not a decision you need to make now or even before your Ch 7 is filed.

Good luck.

[bluemartini]

I "think" your mortgage has to be current to file a Chapter 7

Definitely not true.

Also, keeping or losing the home is not a decision you need to make now or even before your Ch 7 is filed.

This is true to a certain extent. But IMO for practical purposes --- if the OP is going to let the home go at some point, it would be better to expedite it now in the BK -- so she can begin rebuilding her future -- vs. doing the BK now and then letting a foreclosure drag out for two or three years. Otherwise she would be stuck in credit h3ll for several years before she could start fresh.

OP look at it this way; your credit rating is going to take a big hit with the bankruptcy anyway. If you really really want to keep the house, go for it and try for the loan mod. But in my opinion the loan mods that are being offered these days are not all that great. Unless you are sentimentally attached to the home or have strong reason to believe that you'll get a really great loan mod offer, I would think about walking away from it. It really depends on how you feel, though.

[runnersdelig]

This month is the 2nd month where we aren't paying our cc bills and are only paying living expenses (mortgage, food, utilities, childcare, etc.). It has been super stressful because I worry about who's going to be serving me papers sionce I've already been served with 2 summons. But, I know that it will end soon either this month or in September depending on what our new attorney says.

Our mortgages are huge - almost 50% of our net and though I'm tempted to walk away from it, I can't. I need a home for our kids and they love the one we currently have. I'm planning on using all raises/tax returns we get in the future to pay off our 401k Loans so we can have breathing room in our paychecks but until then things are tight with us.

[gmk]

I stopped paying everything, mortgage, CCs, etc. except for installments on back taxes 4 months before filing. I was planning on surrendering the home so I did stop the mortgage payments.

[nervous1]

This month is the 2nd month where we aren't paying our cc bills and are only paying living expenses (mortgage, food, utilities, childcare, etc.). It has been super stressful because I worry about who's going to be serving me papers sionce I've already been served with 2 summons. But, I know that it will end soon either this month or in September depending on what our new attorney says.

Our mortgages are huge - almost 50% of our net and though I'm tempted to walk away from it, I can't. I need a home for our kids and they love the one we currently have. I'm planning on using all raises/tax returns we get in the future to pay off our 401k Loans so we can have breathing room in our paychecks but until then things are tight with us.

Are you saying that you have been served 2 summons on credit cards that you just stopped paying 2 months ago?

[youngnbroke]

I made our last CC payments in May (the phone has been ringing off the "hook") June was the last 1st mortgage payment and May was the last 2nd mortgage payment. Besides the annoying phone calls, its been great - actually have money to pay for the necessities ON TIME! I worry though that with us not being current on our mortgage it will screw us with filing a chp 7 -wondering if we'll still be able to use the amount we owed on the means test, the amount allotted for our state would give us too much DMI. We have no intentions on keeping the house. Any thoughts??!! (hope to file this month)

[runnersdelig]

Are you saying that you have been served 2 summons on credit cards that you just stopped paying 2 months ago?

The summons from discover, I had stopped paying for 5 months. The summons from citicard, I had stopped paying about 8 months ago. All the other cards, I just stopped paying in June.

[ssmdem]

The summons from discover, I had stopped paying for 5 months. The summons from citicard, I had stopped paying about 8 months ago. All the other cards, I just stopped paying in June.

What did you owe Citicard? Just trying to see what kind of time I might be looking at on my own?

[MD69107]

I stopped paying all the credit cards last April. I stopped paying the mortgage in September.
Filed Chapter 7 April of this year.
Still living in the house, waiting to get a sale date from the bank's laywers. I have a place to rent for half of what my mortgage was.
The credit cards started out trying to threaten me.....then they offered reduced amounts.
I had Chase, Household and Cap One credit cards.
Almost a year on all the credit cards, never did get anything more than a few threatening letters though.

[angles]

Our mortgages are huge - almost 50% of our net and though I'm tempted to walk away from it, I can't. I need a home for our kids and they love the one we currently have.

50% is pretty huge. I know your kids love living there but consider what you could do as a family if that was reduced to 30% or lower (vacations, trips, Christmas)?

[ssmdem]

50% is pretty huge. I know your kids love living there but consider what you could do as a family if that was reduced to 30% or lower (vacations, trips, Christmas)?

AMEN!! Totally agree! runnersdelig - please don't think I'm criticizing - I'm not. Been there and have felt the same as you. Our payments were about 50% of our take home as well -- I didn't care. I built this house for my kids and we all LOVED it. Of course, we didn't get to go on the vacations that we used to, but I figured it was a good trade-off. Well, I lost my job, husband hours got cut, and we were all of a sudden at more like 75% of our take home. Yeh, that obviously wasn't happening which is what has pushed us into this - but shortly after then and before my kids knew we were in financial trouble, my son asked, "Mom, when are we ever gonna go do stuff like we used to?" I told him that living in this house had its trade-offs, and we had to be willing to give up stuff if we wanted to stay. Without thinking it about it for more than a second, he said, "I'd rather live in our old house and still get to go to on real vacations."

Not saying you're making the wrong decision. Just think about it. If you're filing anyway (I'm asssuming you are), now is the time to truly start over fresh. I'm so looking forward to having some breathing room and not feeling guilty for stopping at McDonald's for my caramal frappe.

[runnersdelig]

AMEN!! Totally agree! runnersdelig - please don't think I'm criticizing - I'm not. Been there and have felt the same as you. Our payments were about 50% of our take home as well -- I didn't care. I built this house for my kids and we all LOVED it. Of course, we didn't get to go on the vacations that we used to, but I figured it was a good trade-off. Well, I lost my job, husband ours got cut, and we were all of a sudden at more like 75% of our take home. Yeh, that obviously wasn't happening which is what has pushed us into this - but shortly after then and before my kids knew we were in financial trouble, my son asked, "Mom, when are we ever gonna go do stuff like we used to?" I told him that living in this house had its trade-offs, and we had to be willing to give up stuff if we wanted to stay. Without thinking it about it for more than a second, he said, "I'd rather live in our old house and still get to go to on real vacations."

Not saying you're making the wrong decision. Just think about it. If you're filing anyway (I'm asssuming you are), now is the time to truly start over fresh. I'm so looking forward to having some breathing room and not feeling guilty for stopping at McDonald's for my caramal frappe.

I am not taking it as criticism, believe me. I have thought about it a lot especially since 50% of my income is going to my home and things are tight. Part of the reasons why I think we'll be okay in the house are:

1. I'm getting at least a 10% pay increase in September. My boss already told me this week.

2. I'm planning on using next year's bonus (if any) and tax refund (if any) to pay our 401k loans.

We stupidly took out 401k loans to pay cc cards and keep house current.

I have been looking at homes that we can rent and there are some but they are only $200 less than what we pay in our mortgage now. We live in a high cost of living area and it really sucks.

[runnersdelig]

what did you owe citicard? Just trying to see what kind of time i might be looking at on my own?

$18k. 9k of which were interest and fees they charged us.