I decided not to file, but to ride it out:

[DaddyDavid]

1.3 million in debt (1 million real estate, the rest in CC). In this state there is no recourse for mortgage default (they can't sue for their losses if you foreclose), and CC debt is not legally collectable after 3 years. So 3 years has passed, all the debt is gone, and I still have the option to file BK if I need to. My credit was awful, but it has improved now so much so that an unsecured CC just upped my limit by $3000, and I did not even request that. Just an FYI- with the huge new expense and hassle of filing BK, I decided not to, if anyone else is having a quandary about whether or not they need to file- there are options, is all.

[free2breathe]

Congrats on not having to file. Your post just brings to light, once again, that filing bankruptcy is definitely an individual process. For some, having the debt discharged is the right business choice, and for others it's not. If you are able to ride out the storm to the other side of the collection abyss, that is certainly a good option. I think most everyone on this board would agree that you really need to examine all your options very carefully.

[DaddyDavid]

Yes, there are literally 100's of things to ponder before filing.

And the more expensive filing gets, and the more they shorten the time frame between filings, it's even more important to chill and examine all possibilities. The deciding factor for me (I'm single with no dependents, no job, no property to risk losing, etc, BTW) was that I could actually file, be discharged, then rack up a huge medical bill, for example- and then not have the option to file BK to discharge that medical debt because I had already filed. This site is really incredible- I still don't understand who or what or why it exists, a free site with such a vast wealth of consumer information, but it sure led me down the right paath and saved me mega bucks!

[feelingnutsy]

Hi---DaddyDavid---not clear about the more they
shorten the timeframe between filings---since I
thought that the timeframe was lengthened from 5 years to 8 years.

[Flamingo]

And the more expensive filing gets, and the more they shorten the time frame between filings, it's even more important to chill and examine all possibilities. The deciding factor for me (I'm single with no dependents, no job, no property to risk losing, etc, BTW) was that I could actually file, be discharged, then rack up a huge medical bill, for example- and then not have the option to file BK to discharge that medical debt because I had already filed. This site is really incredible- I still don't understand who or what or why it exists, a free site with such a vast wealth of consumer information, but it sure led me down the right paath and saved me mega bucks!

I believe you mean the word "lengthen" instead of "shorten" in your first sentence above since the time between filings last increased in 10/2005 to 8 years between Chapter 7 filings and I believe 7 years between Chapter 13 filings. And all states and situations are different so one must investigate all options available in the state in which they reside.

[DaddyDavid]

I must be dyslexic?!

But what I meant to say is the availability of filing has been shortened, because now you have to wait even longer to file another BK? Anyway, for instance- if you foresee a possible huge medical expense or other problem coming towards you- that is a good reason to think about stalling a BK filing, because after you file you'll have a long wait before you can file again.

[helpme2010]

I like the way your state works. If I foreclosed in California, you better believe the mortgage company would have followed me for that debt and anything they relieved would have been shown as income and would be taxed. Did you factor in that you will owe that amount on your federal taxes?

I also like that credit card companies can't come after you after 3 years. That blows my mind away that you have a law that protects you in this way.

congrats

[HHM]

Just keep in mind, SOL is only a defense to a lawsuit. It does mean that collection efforts stop.

You need to realize there is a difference between having rights and enforcing rights. For most people, BK is the shortest path to rebuild. As your junk debt gets traded around, it will always hound your credit in some manner.

[DaddyDavid]

All states have different SOL re:CC debt. AZ is 3 years. Also every state handles foreclosure debt differently- in AZ you can't be sued for deficiency on a single family dwelling (and I had three of them). As far as taxes- I had more debt than assets when this all happened, so I was also exempt from any tax liability. My credit score keeps going up tho-if I had filed BK that would not be happening this quickly. Lot to think about, folks.

[shark66]

You most certainly had all your ducks in a row, and were aware of all the options available...

My hat goes off to you. Seriously.

Good luck.

[HHM]

Your false assumption is how quickly credit recovers after BK. It is not a 7-10 year death sentence, most people are back in the 700's within 18-24 months after BK.