What would you do and why? Pay off debts or file for bankruptcy?

Question

I divorced in 2006 and agreed to let my ex live in the house, sell it and keep any profit in exchange for her paying the mortgage. I'm sure you'll guess - it didn't sell and she didn't pay. I continued making payments until late last year when I ran out of credit to subsidize my life. She finally abandoned the house this spring when the foreclosure notice came and I went to court to fight for time to make a real effort to sell it, which I did last month. I am now saddled with about $800 in min. payments on various credit accounts and $150/mo for the next 9 years to the mortgage ins. company for the deficiency. So far I haven't missed any payments and anticipate I can pay off the cards/loans in 5 years if I budget $800/mo the entire time. My attorney tells me I'm better off filing Chapter 7 and keeping my money. I make about $45K so it's tight. Also, I have 2 car loans (mine and my girlfriend's). She pays the loan but it's in my name and we can't afford to lose either car.

Answer 1

I was in a similar situation and refused to file for bankruptcy for a long time...it finally just got to be too much.  Honestly, filing for bankruptcy was the best thing that I ever did for myself and my future.  I have no debts and I can invest the money that I make in my future.  A lot of people will tell you not to do it...and it's your choice as to what you do...but I have felt nothing but relief.  Anyone who insults you for doing so is not in your shoes.  The only people that even know that I did it are my parents and my husband.  Good luck to you =]

Answer 2

If you think you can manage it just fine without filing for bankruptcy, then I would do it.  For me bankruptcy would be the last resort.  

Of course the attorney wants you to file, he is the first one to get paid when you do....

Answer 3

Been in your shoes. I elected to pay the loans. Yes it was tight. My girlfriend (now my wife) sometimes didn't agree or understand,but we worked through it. I worked a full time and a part time job to do this. I 1st paid off my smallest dept. and worked from there. It took me 5years to do this. If I filed bankruptcy I would have had bad credit for many years. Yes you can get a loan but the interest rates are sky high. Now today I am carefull where how and when I spend or borrow money. I can also look myself in the face and feel stronger. So if I ever borrow money from you....you will be paid back. Best of luck to you my friend.

Answer 4

Listen to your attorney, or get a second opinion & then decide. Best of luck.