Filing bankruptcy questions?

Im pretty sure i will be filing this year, im just in over my head and it's stressing me out. Im a SAHM and even if i get a job, the kids daycare would deverly limit the anmount i would actually bring home to pay these bills and my student loans are coming due so those on top of the $9,000 in bills is just too much. How does this work? What does it cost to do? The house it under my DH't name, not mine....will they take my house? Will my banruptcy show up on my husband's credit if he apllies for something, like only him applying for anything without me? Im just wondering if he will have trouble applying for anything if i have filed for bankruptcy even thought he has impecable credit....can anyone talk me through how this will work? Will he need to come with me for the court hearings or will it just be me?

ETA: We have nothing jointly, all bank accounts, cars and the house is all under his name, we don't have any CC together either. The only thing tying DH and i together is that we are married, we are financially separate, will he need to be involved at all?

Message edited 2/10/2012 8:56:31 AM.

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What kind of bills do you have that you need to file for bankruptcy? Student loans are not covered under the bankruptcy laws so it will not help you out too much. With the new laws you will still be responsible for some of the debt. Personally I would suggest calling a debt counselor and seeing if there is a better way to go about this. DH will be involved because he is legally part of you.

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This is JMO but $9K in credit card bills does not seem like an amount that should be unmanageable to work out and pay off.

I also don't think you can file bankruptcy because of student loans.

There are many girls on here who have been put into really rough financial situations and managed to get the debt under control.

I know that you need to take some of the stuff that is said on LIF with a grain of salt, but there is a lot of great advice on here regarding debt and paying it off.


I would FM Beth. She's one poster who has been very inspirational with this kind of stuff.

ETA: I also would seriously think about $ucking it up for awhile and getting a job off-hours from when your DH is at work. Even if it is waitressing or working at Starbucks.

Message edited 2/10/2012 9:14:31 AM.

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From what I heard, not sure if it's true or not, but student loans are always there regardless of bankruptcy. That if you file, the other debt may go away but not the loans.

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Message edited 3/27/2013 10:00:56 PM.

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Message edited 2/10/2012 9:36:46 AM.

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I would definitely talk to a lawyer, because regardless of whose names are on things, there is a certain level of joint liability.

I know you said the CC's are in your name, but what are you buying?? Why can't DH help you out? Obviously as a SAHM, your ability to pay bills is quite limited, and he has to know that.

And as PP's said, it is almost impossible to have student loans forgiven under bankruptcy.

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Posted by Karen

I would definitely talk to a lawyer, because regardless of whose names are on things, there is a certain level of joint liability.

I know you said the CC's are in your name, but what are you buying?? Why can't DH help you out? Obviously as a SAHM, your ability to pay bills is quite limited, and he has to know that.

And as PP's said, it is almost impossible to have student loans forgiven under bankruptcy.

Message edited 2/10/2012 9:45:40 AM.

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Personally I wouldn't do it. You are putting yourself at an EXTREMELY vulnerable position.

You have no income, the house isn't in your name & you are now setting yourself up for being shot down for any line of credit for a number of years. You never know where you're going to be in those years.

I'd call a consolidator or figure it out on my own.

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What about weekends?

And as I mentioned, if you got on a per diem list for something, then you could work if you felt up to it. It wouldn't be a set schedule.

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You can not discharge student loan debt in bankruptcy unless you can prove have a disability (and even then, it is VERY tough to get them discharged) Pretty much, you have to be dead in order to discharge a student loan.

If the student loans are causing that much pain financially, look into an income based repayment through your lender. You can also put your loans into forebearance if needed under most circumstances. They will continue to accrue interest but you could use that money towards the 9k and chip away at that quickly.

9K isn't that much debt. I personally wouldn't file bankruptcy for 9k unless it was my absolute only option, especially when 20K is going to survive bankruptcy. Having been through the process, it can be a great relief, but if that was the total of mine? No way. I know with attorney fees and court fees, it cost me over 2K to file for a Chapter 7. My debt was well over 60K and was rising from interest, not including my student loans. I walked away with a fresh start and still had 10K in student loans. Those are the pros. The cons are the obvious hit to my credit plus the stigma surrounding it.

NYS isn't a community property state. Your debts which are in your name alone are yours. The house is his alone. His credit is his credit, yours is yours. If you have joint accounts, then your portion would be discharged and DH would be considered solely responsible from a legal standpoint.

You will need to meet the means test and DH's income will become a factor. http://www.nolo.com/legal-encyclopedia/chapter-7-bankruptcy-means-test-eligibility-29907.html

Like another poster said, I would look into other sources of income first: babysitting, work at home jobs, PT nights somewhere................... and look into possibly a consolidation loan or reputable credit counselor. 9K can be erased pretty quickly.

Most consults with bankruptcy attorneys are free. creditboards.com is a great resource as well.

Good luck.

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Is DH able to pay off your debts with *his* money? If he has money to pay debts, but you don't, there needs to be some discussions between the two of you about finances. As a SAHM, you ARE working, and bringing in a pretty good "salary" (at the bare minimum, you're not having to pay for daycare, so that cost is part of your salary).

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Have you considered calling the card companies and seeing if they will take a lump settlement (i.e I will give you say 5k if you will settle it right now) - I know a few people who did this and paid off some of the highest cards for 50% (and more) of what was owed. There are tax consequences (I think the card companies give you something for IRS that is treated like income - but if you could cancel out a bunch of the cards it might be in your better interest. Just another option. I also had a friend who called and they worked out a much lower monthly payment (you won't be able to use your cards) but she was able to reduce the high interest to say 5% - so her monthly payment went from I think she say around $250 to like $90 - or lower. You might want to look into some other options before bankruptcy.

Message edited 2/10/2012 9:57:22 AM.

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I don't think bankruptcy is the answer at all. You need to sit down and work with your creditors to get a handle on the debt. Bankruptcy is a lat resort, but it seems like you think it is an out instead of trying to find a better solution. Why can't you do babysitting or work overnight at a diner?

Re: Filing bankruptcy questions?

If you can't make payments on one or more of your student loans, you may be able to get temporary or permanent relief from making payments.

Learn about your options before you go into default. If you default on your student loans, you will suffer negative consequences. For example:

•Your credit will be damaged.
•Your loan balance will increase dramatically as collection fees are added to the pot.
•In the worst-case scenario, your loan holder will take aggressive action to get the loan money from you, including taking a portion of your paycheck or your tax refund. (For information on how the lender can collect student loans, see Nolo's article What Happens If You Default on Your Student Loans.)
Your Options
If you are unable to make loan payments, some options include:

•postponing payments through deferment or forbearance programs
•eliminating the loan altogether through loan cancellation
•discharging the loan in bankruptcy, or
•considering other, more affordable payment plans or loan consolidation. (For more on this, see Nolo's article Student Loan Repayment Options.)
Deferring Student Loans
A deferment excuses you from making student loan payments for a set period of time because of a specific condition in your life -- such as returning to school, economic hardship, or unemployment.

Qualifying for deferment. You can defer repayment of a student loan if:

•you meet one of the conditions described below (see "Conditions for Canceling or Deferring Student Loans", below), and
•you are not in default -- that is, you have made your payments on time, are in the grace period after graduation, or have been granted other deferments or forbearances.
How to get a deferment. Contact the holder of your loan and request the appropriate form based on the reason you think qualifies you for the deferment.

Obtaining a Forbearance
In a forbearance, your loan holder gives you permission to stop making payments for a set period of time. Interest always continues to accrue during a forbearance. Forbearances are granted for up to one year at a time. In some circumstances, a forbearance may be available even if you have defaulted.

Forbearances are easier to obtain than deferments or cancellations, because they are not tied to the type of loans you have or the date you obtained them -- and they aren't governed by the picayune rules that make cancellations and deferments so hard to come by.

Qualifying for a forbearance. Forbearance on federal loans may be granted for a number of reasons, including:

•poor health
•unforeseen personal problems
•inability to pay within the maximum repayment term (usually 10 years), or
•monthly payments totaling more than 20% of a borrower's monthly income.
How to get a forbearance. To apply for a forbearance, contact the holder of your loan, explain your situation, ask for a forbearance, and fill out the appropriate forms

Discharging Student Loans in Bankruptcy
Very rarely are student loans discharged in bankruptcy. However, it is possible if you can prove that repaying the loan would be a severe hardship for you -- a very difficult standard to meet. Courts consider several factors in making this determination, including:

•your income and expenses
•how long your financial problems are likely to continue, and
•how hard you've tried to repay your debt.
You must file a separate court action in your bankruptcy proceeding supporting your discharge request. You'll probably need an attorney to help you with the procedure

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Link

This is the link to my pp. I think forbearance might be a good option for you.

I agree about contacting a lawyer for a free consult.

Message edited 2/10/2012 10:13:04 AM.

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I would just consult a BK attorney instead of asking people that have no idea about it. It's free.

I wouldn't even bother defending yourself on here at this point, because only YOU know your situation.

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I won't file either before consulting with a pro, 29k can be manageable. You can probably put your school loan on hold and pay the min. you can on the 9k balance.

If you you want to work, you can hire a nanny instead of sending all 3 kids to daycare, that's less expensive. Or pay a friend or relative to care for the kids at a reduced cost. My bro has a nanny who cares for his 3 kids for 1800/mo 6 days a week..

Or find a job that allows you to work from home - ie. customer rep, billing, etc. to reduce the cost on nanny care.

It's entirely possible, hang in there!