In enormous debt and lost job - chapter 7?

Question

I admit it, I majorly fail at finances. I tried riding the 0% interest rate game by transferring balances around. Many years later (now), here's my horrible circumstance:

Primary mortgage owned: $200k

HELOC balance: $80k

credit card debt: $60k

Possible house sale value in today's market: about $220k ($280k is owed "secured" debt on the home .. .primary+heloc)

So, my credit score is actually decent because I make my payments every month and on time (for years). I've just recently lost my job, so I'm looking at the bad reality now.

There's no chance for a Chapter 13 since I do NOT currently have employment.

I own 2 vehicles outright (actually, I just transferred the debt about 1 year ago to the HELOC for better interest rate payments on this debt).

Each car's resale values are probably $12-14k each.

What would happen if I filed for Chapter 7? Forced to sell the home, cars, etc? I'd want to keep at least 1 car (for my next job soon hopefully) and want to save the home and will have to borrow from relatives or something until I get back on my feet with a new decent job.

I understand the unsecured CC debt would go away I guess.. but what happens to the house/cars?

Thanks in advance!

Answer 1

Post your situation in this forum.

http://www.savingadvice.com/forums/

This is the place that can give you sound advice. I have seen how this community help each other getting through all the debt, savings, investment situations.

Answer 2

Bankruptcy is brutal anymore and is not the burden relief it used to be. You still have options. If you're correct about the vehicle values you should definitely sell at least one. Maybe both and buy a temporary crapper until you can get reemployed. Stash that money away and use it to supplement your unemployment insurance.

A refi is pretty much out of the question with the loss of your job. Consider other things you can sell that are unnecessary luxuries. It's a terrible thing to have to do, but you really want to avoid bankruptcy. Also, you may want to consider the possibility of renting a room out, or the basement (assuming you have one).

I offered personal assistance to another individual on Answers who is also having debt problems. I'm really good with this sort of thing and I'm not looking to get paid, just like to help. Shoot me an email if you would like the assistance.