I have questions about bankruptcy, is it really necessary in my case?

Question

My husband and I are thinking about filing bankruptcy, he has approximately $10,000 in debt from huricanne katrina (bills he had from before the storm, and never cleared up when he got moved), and approimately $10,000 in medical bills. Also we have $15,000 in credit card debt. We owe on one car and recently purchased a home, but are not wanting to file on those. I gues my question is this feels like our only way out, what do you think? We feel like we're drowning and financially we can't afford to go on like this anymore. We aren't behind on anything except the medical bills and we haven't touched the debt from katrina. So with the economy the way it is, what is your opinion? I just want to be able to live a normal life and stop worrying. We can't even afford groceries because obviously we have over extended ourselves. If we file, we are definately NOT getting any credit cards. I vow to never make the same mistake again!

Answer 1

Bankruptcy should be your last resort...First you do need to set up an appointment with a qualified bk attorney in your area, most will see you on a first free consultation. They will need to see your last 6 months of pay stubs, assets, list of all your debts and last 4 years of taxes to be able to tell you what you qualify for. The new laws changed the amount of median income to qualify for a chapter 7 as the qualification goes by income and what state you live in. The mortgage and the vehicle loans can be re-affirmed (pay per the norm) in a chapter 7. If you don't qualify for a 7 you would then have to go into a chapter 13 payment plan, which is set up thru the US Bankruptcy Court Trustee. The trustee would handle all your payments for 5 years, and pay the secured debts first then the unsecured debt gets paid last. In a 13, the mortgage and vehicles don't have to be current like the chapter 7, but, are run thru the plan and after the plan is complete after the 5 years, the mortgage would resume like you normally pay on your own. The chapter 13 plan pay is deducted from a paycheck however you get paid and sent to the trustees office, then distributed out. In a chapter 13, which I'm not a fan of, but...if within the 5 years you find you need to finance something and someone is willing to finance you would need to get the approval of the trustee, which usually takes approx 30 days to receive the no or yes. Best Advice...call a few bk attorney's in your area and see what you qualify for...with the amount of debt you have, they would need to look at everything, as well as your income and base your qualifications on that. Good Luck!

Per the advice of es above....the new laws do not allow you to pick what you file...all debt has to be reported to the courts. There are no longer any large purchases as they did years ago and then file bk and get to keep them. You need to weigh all your options and then decide if a bankruptcy is what is best for your...The debts stay on your record for 7 years, the bankruptcy is reported on your credit report as a US Bankruptcy Court filing and it will show your actual date of discharge, or dismissal if you don't follow thru with the payments. Good Luck again!

Answer 2

I would suggest a trip to a consumer counseling agency for an expert opinion. You may be able to repay without bankruptcy. Check out the site below:

Answer 3

try this website.. it may answer some of your questions...

http://www.legalhelpers.com/index.html

Answer 4

You can't pick and choose what you file on. You will have to inform your mortgage lender if you file for bankruptcy. You should see a bankruptcy lawyer and find out how to proceed. Don't take advice here. This subject is too complicated for this forum. Good luck. Perhaps you will be able to renegotiate your debt for lower payments without filing for bankruptcy. See what you can do. Proceed carefully.

Answer 5

if u have no other choice...... i mean hopefully those 7 years of bankrutcy on ur record will go by fast