We're still here, and still going through a Bankruptcy. I think I knew Bankruptcy wasn't quick by any means, but I don't think I was expecting it to take this long!
The last time I wrote, we had attended the 341 Meeting (meeting of the creditors). It was basically our opportunity to sit down with the Trustee and go over filing and our proposed payment plan. After which, the Trustee would confirm the plan, as long as there were no disputes from our creditors and as long as the Trustee thought it was a satisfactory payment plan. The Trustee said most everything looked fine. He had a few questions, but in the end, said our proposed payment plan seemed adequate and that no adjustments were necessary at that time.
Well, imagine our surprise when we got a letter in the mail about a month ago saying that the Trustee wanted to dismiss our case! Apparently, he did not agree to some of the items and that we had to amend our filing, and it wasn't even in reference to the rental property we were worried about after the 341 Meeting - it was something entirely different. What in the world? Isn't this why we hired a Bankruptcy attorney????? So we don't run into these types of snags?!?!
We notified our attorney and they told us it was the Trustee's last-ditch effort to 'spook' us into backing out of Bankruptcy. They informed us our paperwork is correct as filed and all we needed to do was sign an affidavit and the problem was solved. Who would have thought the Trustee would try and use mind games to manipulate us? Of course, it's all new territory, so we don't really know *what* to expect, but it definitely wasn't that!
At this point, we are just waiting on the Confirmation papers from the Trustee, which will let us know the Trustee has finally approved our proposed payment plan and then we will be getting closer to the end. If all goes well, it will likely be another year or so before our case is completely discharged, but a plan Confirmation will take away some of our lingering doubt about this entire process. Almost four months after we first filed our papers and we're still in limbo! Now we know that Bankruptcy is not a short process.
***
Oh, and we did eventually get an answer about the extra payment the Trustee sent to the bank for payment on our vehicle. It was sent in error and the bank wound up sending the money back to the Trustee.
Wednesday, November 25, 2009
Wednesday, September 16, 2009
The 341 Meeting
We have now been to 'court,' better known as the 341 Meeting or Meeting of the Creditors or Creditors Hearing. Really, it wasn't even in a courtroom! What it was was m-i-s-e-r-a-b-l-e, if for no other reason than we were stuck there for literally twelve hours.
The first 3 hours was a credit counseling session - how to turn the Bankruptcy into something positive and not fall back into the same trap at some point in the future. Then, from noon until 7:00 that evening, we sat and sat and sat and sat and sat and sat... just waiting for our case to be called. It was a huge room filled with other people like us, with a table at the front of the room, and each case was called one by one to sit and answer whatever questions the Trustee (the attorney handling the case for the U.S. Bankruptcy Court) might have had.
When we were finally called, there were about 5 people left in the room. o_0 The Trustee didn't have any hard questions for us, but did raise an eyebrow toward our rental property. We are not behind in any of our secured debt payments, so we are not in immediate risk of losing anything. But, according to the Trustee, since we are not falling behind on the rental property, he said he didn't know if he could in good faith let us keep the property. Yet, when you look at what we owe and what it could be sold for, there would likely be a loss, so it's not like selling it would 'fix' anything. I really don't understand his logic - it seems counterintuitive. But, at the end of the meeting, he did say that the proposed Chapter 13 payment plan seems suitable, but he would still need to look closer at a few things.
We left feeling completely defeated. Demoralized. Deflated. Demeaned. Depressed. We were kind of stunned, since the paralegal had assured us that there was really no reason for the Trustee to be concerned with the rental property... its value and the amount we still owe being the main factor. It kind of leaves things completely up in the air, especially since we had hoped to get renters in there ASAP. Now, we can't in good faith rent it to anyone until we know its fate!
For now, it's a hurry up and wait situation until we hear back from the Trustee with an approval from the U.S. Bankruptcy Court that our Chapter 13 payment plan has been approved. Of course, before all of that, the Trustee has to wait 30 days from the date our creditors were informed of their right to file a claim against us for our debts, or something along those lines.
Really, I just want all of this to be over... and I know that won't be achieved for at least another year. I never would have known Bankruptcy was such a long process! Maybe it used to be?
Oh yes, and the icing on the cake!!! I have sent 3 E-mails over the past few weeks to our paralegal and have not received any responses. In one instance, we got a packet in the mail a few days after I sent my E-mail, so I thought she had either read my E-mail and replied with the packet, or it happened to be a fortunate coincidence. Well, today we find out that our paralegal NO LONGER WORKS AT THE LAW FIRM! It was so nice of them to let us know that we now have a different paralegal! Thank goodness Mr. America called today to check on a few things, because there's no telling when we would have found out. Our new paralegal claims the E-mails should have been forwarded from the old paralegal's E-mail, but it doesn't seem if that happened. I was very pleased to see an E-mail from our new paralegal that pretty much answered some of my questions, but I do have two concerns.
First, she addressed me as Amanda. It's a beautiful name, but it is not MY name!
Second, she didn't answer the question about the payment the Trustee made to our automobile, even though the automobile is secured and should not be included in the Bankruptcy.
Amanda. Hmph.
The first 3 hours was a credit counseling session - how to turn the Bankruptcy into something positive and not fall back into the same trap at some point in the future. Then, from noon until 7:00 that evening, we sat and sat and sat and sat and sat and sat... just waiting for our case to be called. It was a huge room filled with other people like us, with a table at the front of the room, and each case was called one by one to sit and answer whatever questions the Trustee (the attorney handling the case for the U.S. Bankruptcy Court) might have had.
When we were finally called, there were about 5 people left in the room. o_0 The Trustee didn't have any hard questions for us, but did raise an eyebrow toward our rental property. We are not behind in any of our secured debt payments, so we are not in immediate risk of losing anything. But, according to the Trustee, since we are not falling behind on the rental property, he said he didn't know if he could in good faith let us keep the property. Yet, when you look at what we owe and what it could be sold for, there would likely be a loss, so it's not like selling it would 'fix' anything. I really don't understand his logic - it seems counterintuitive. But, at the end of the meeting, he did say that the proposed Chapter 13 payment plan seems suitable, but he would still need to look closer at a few things.
We left feeling completely defeated. Demoralized. Deflated. Demeaned. Depressed. We were kind of stunned, since the paralegal had assured us that there was really no reason for the Trustee to be concerned with the rental property... its value and the amount we still owe being the main factor. It kind of leaves things completely up in the air, especially since we had hoped to get renters in there ASAP. Now, we can't in good faith rent it to anyone until we know its fate!
For now, it's a hurry up and wait situation until we hear back from the Trustee with an approval from the U.S. Bankruptcy Court that our Chapter 13 payment plan has been approved. Of course, before all of that, the Trustee has to wait 30 days from the date our creditors were informed of their right to file a claim against us for our debts, or something along those lines.
Really, I just want all of this to be over... and I know that won't be achieved for at least another year. I never would have known Bankruptcy was such a long process! Maybe it used to be?
Oh yes, and the icing on the cake!!! I have sent 3 E-mails over the past few weeks to our paralegal and have not received any responses. In one instance, we got a packet in the mail a few days after I sent my E-mail, so I thought she had either read my E-mail and replied with the packet, or it happened to be a fortunate coincidence. Well, today we find out that our paralegal NO LONGER WORKS AT THE LAW FIRM! It was so nice of them to let us know that we now have a different paralegal! Thank goodness Mr. America called today to check on a few things, because there's no telling when we would have found out. Our new paralegal claims the E-mails should have been forwarded from the old paralegal's E-mail, but it doesn't seem if that happened. I was very pleased to see an E-mail from our new paralegal that pretty much answered some of my questions, but I do have two concerns.
First, she addressed me as Amanda. It's a beautiful name, but it is not MY name!
Second, she didn't answer the question about the payment the Trustee made to our automobile, even though the automobile is secured and should not be included in the Bankruptcy.
Amanda. Hmph.
Wednesday, September 2, 2009
OK, Wait... What?
Okay, so I am now thoroughly confused!
Even though we have not yet gone to court, we have still been responsible for making payments to the Bankruptcy Trustee. Since we are technically filing under Chapter 13, it requires that we be set up on a payment plan to 'pay back our debts.' According to our attorney, this form of Chapter 13 does not actually repay our debts, but it is merely the attorney's fees set up on a payment plan. In other words, $2,000+ attorney's fee is split up over a monthly payment for the next 18-36 months.
As I previously mentioned, this form of Bankruptcy also allows us to keep our personal property (home and vehicles), yet discharges our unsecured debt (credit cards and medical bills). As a result, we have stayed on top of all other payments while letting our credit cards go past due.
I logged on to check that our automobile payment went through and was a little surprised to see not only the regularly scheduled automatic payment, but a partial payment made in the form of a check. I did not send any extra money for our auto loan, so I called to ask what was going on. I was really thinking it was a misapplied payment that probably belonged to someone else.
Imagine my surprise when I was informed it came from the Bankruptcy Trustee! At first, the representative informed me that, as a result of the Chapter 13 filing, he could not speak to me in reference to anything on our account, and referred me to the Loss Department (or something like that). But, I did manage to get out of him that the payment came from the Bankruptcy Trustee.
So, the monthly payment that we thought was supposed to cover only attorney's fees is actually being split up and mailed to our creditors! Are they sending payments to *all* creditors or just the ones that own the property we are keeping? I hope they haven't been sending our money to the credit card companies!
Is it just a preliminary arrangement until we go to court and get a final ruling? Will we get that money back? Will it get sent to the attorney to cover attorney's fees, like I originally thought? Or have we been 'duped' by our attorney?
I have a feeling this whole process is about to get even more confusing.
Even though we have not yet gone to court, we have still been responsible for making payments to the Bankruptcy Trustee. Since we are technically filing under Chapter 13, it requires that we be set up on a payment plan to 'pay back our debts.' According to our attorney, this form of Chapter 13 does not actually repay our debts, but it is merely the attorney's fees set up on a payment plan. In other words, $2,000+ attorney's fee is split up over a monthly payment for the next 18-36 months.
As I previously mentioned, this form of Bankruptcy also allows us to keep our personal property (home and vehicles), yet discharges our unsecured debt (credit cards and medical bills). As a result, we have stayed on top of all other payments while letting our credit cards go past due.
I logged on to check that our automobile payment went through and was a little surprised to see not only the regularly scheduled automatic payment, but a partial payment made in the form of a check. I did not send any extra money for our auto loan, so I called to ask what was going on. I was really thinking it was a misapplied payment that probably belonged to someone else.
Imagine my surprise when I was informed it came from the Bankruptcy Trustee! At first, the representative informed me that, as a result of the Chapter 13 filing, he could not speak to me in reference to anything on our account, and referred me to the Loss Department (or something like that). But, I did manage to get out of him that the payment came from the Bankruptcy Trustee.
So, the monthly payment that we thought was supposed to cover only attorney's fees is actually being split up and mailed to our creditors! Are they sending payments to *all* creditors or just the ones that own the property we are keeping? I hope they haven't been sending our money to the credit card companies!
Is it just a preliminary arrangement until we go to court and get a final ruling? Will we get that money back? Will it get sent to the attorney to cover attorney's fees, like I originally thought? Or have we been 'duped' by our attorney?
I have a feeling this whole process is about to get even more confusing.
Thursday, August 27, 2009
This Is Where We Are
It's been a bit, so here's where we stand:
We finally got notification of our court date in September, so we're just waiting for that day.
The collection calls *did* stop, thank goodness! When I called one of the credit cards to give them our Bankruptcy Case #, the customer service rep was really nice and wished us luck in our filing - she really seemed concerned for us - so that was unexpected.
We received notification from our credit card companies that our accounts are now closed. Not because of the Bankruptcy, but because of non-payment and over-limit fees.
One requirement of Bankruptcy is that ALL of your creditors are notified, even if some of those debts are *not* being discharged. Co-signers are also notified.
Our car loan is with the bank we use for our checking and savings. Because of this, the attorney instructed us to open an account with another bank where we do not have any debts. This is just in case the bank decided to freeze our account upon getting word of our Bankruptcy. The temporary change in banking institutions has been an adjustment, but hopefully we won't have to do it much longer. Although, I'm contemplating staying at the new bank because their interest rate is a lot better than our usual bank.
Our student loans are not dischargeable in Bankruptcy, but they sent us notification that due to the Bankruptcy, they are now being administered by a different agency, or something along those lines. Kind of confusing.
Since the mortgage company was notified, our mortgage statements now indicate that no payment is due. We will continue to pay them, since we are filing under Chapter 13, but it's weird to see 'No Payment Due' on the statement.
We're still struggling financially, which just seems so bizarre to me. I thought once we stopped being 'responsible' for the debt payments, things would be happy and wonderful. I mean, it's tons better than it was, but it still seems as if we're living paycheck to paycheck. I know I should give it another month or so to really feel the effects, because part of the reason we're still 'broke' right now is because I was trying to catch up on late/past due payments from the past few months and we also had some unexpected car repairs. Right now, we're no longer late on our monthly expenses, and when the new bill-paying month starts on Sept 1st, we should be on track.
Just waiting for the moment we have our $1,000 emergency fund built up so we can start pouring money into our existing debt (automobiles & student loans). I've been trying to keep us on a budget, but since we haven't had the extra cash to put into the emergency fund, and with the unexpected car repairs this month, it's been difficult. This month will be better.
It has to be.
We finally got notification of our court date in September, so we're just waiting for that day.
The collection calls *did* stop, thank goodness! When I called one of the credit cards to give them our Bankruptcy Case #, the customer service rep was really nice and wished us luck in our filing - she really seemed concerned for us - so that was unexpected.
We received notification from our credit card companies that our accounts are now closed. Not because of the Bankruptcy, but because of non-payment and over-limit fees.
One requirement of Bankruptcy is that ALL of your creditors are notified, even if some of those debts are *not* being discharged. Co-signers are also notified.
Our car loan is with the bank we use for our checking and savings. Because of this, the attorney instructed us to open an account with another bank where we do not have any debts. This is just in case the bank decided to freeze our account upon getting word of our Bankruptcy. The temporary change in banking institutions has been an adjustment, but hopefully we won't have to do it much longer. Although, I'm contemplating staying at the new bank because their interest rate is a lot better than our usual bank.
Our student loans are not dischargeable in Bankruptcy, but they sent us notification that due to the Bankruptcy, they are now being administered by a different agency, or something along those lines. Kind of confusing.
Since the mortgage company was notified, our mortgage statements now indicate that no payment is due. We will continue to pay them, since we are filing under Chapter 13, but it's weird to see 'No Payment Due' on the statement.
We're still struggling financially, which just seems so bizarre to me. I thought once we stopped being 'responsible' for the debt payments, things would be happy and wonderful. I mean, it's tons better than it was, but it still seems as if we're living paycheck to paycheck. I know I should give it another month or so to really feel the effects, because part of the reason we're still 'broke' right now is because I was trying to catch up on late/past due payments from the past few months and we also had some unexpected car repairs. Right now, we're no longer late on our monthly expenses, and when the new bill-paying month starts on Sept 1st, we should be on track.
Just waiting for the moment we have our $1,000 emergency fund built up so we can start pouring money into our existing debt (automobiles & student loans). I've been trying to keep us on a budget, but since we haven't had the extra cash to put into the emergency fund, and with the unexpected car repairs this month, it's been difficult. This month will be better.
It has to be.
Thursday, July 30, 2009
The Final Call Log
Tuesday, July 28
9:05 am
2:14 pm
3:05 pm
4:01 pm
4:39 pm
5:48 pm
6:24 pm
6:25 pm
8:23 pm
8:24 pm
Wednesday, July 29
9:45 am
1:38 pm
2:58 pm
4:02 pm
4:43 pm
5:48 pm
6:42 pm
6:50 pm
7:10 pm (answered after I checked my E-mail and saw the Case Number)
Friday, July 30
9:04 am (answered to give them the Case Number)
This should be the end of the calls... we hope.
9:05 am
2:14 pm
3:05 pm
4:01 pm
4:39 pm
5:48 pm
6:24 pm
6:25 pm
8:23 pm
8:24 pm
Wednesday, July 29
9:45 am
1:38 pm
2:58 pm
4:02 pm
4:43 pm
5:48 pm
6:42 pm
6:50 pm
7:10 pm (answered after I checked my E-mail and saw the Case Number)
Friday, July 30
9:04 am (answered to give them the Case Number)
This should be the end of the calls... we hope.
Wednesday, July 29, 2009
So Far...
We have a Case Number with the U.S. Bankruptcy Court! Still waiting to find out when our court date is, but we should know within the next week or so.
Mr. America and I still can't get over just how easy this entire process has been so far. I keep waiting for a 'shocker' of some kind - something that stops me dead in my tracks and makes me regret this entire decision. It's almost like buying a house, in many ways. First, there's the paperwork. Sign this, sign that, sign this, and this, and this, and this. Then, there's the whole disbelief aspect, where you won't actually believe the house is yours until you have the keys and are standing in your living room for the very first time. I don't think we'll really believe the bankruptcy has gone through until we pull our credit reports and see proof, and that could be another several months from now, even if our court date was tomorrow.
I know I haven't mentioned what type of Bankruptcy we're filing, but that's because we weren't entirely sure exactly which Chapter the attorney was going to 'recommend.' We were given a pretty good idea, but it was really up to the attorney. There are two Chapters, 7 and 13. The simple Chapter 7 explanation is that it eliminates all of your debt, but also forces you to sell everything of value. The simple Chapter 13 explanation is that it is basically an interest-free unsecured debt consolidation loan (no real or personal property is covered) handled by the U.S. Bankruptcy Court, with a monthly payment required for up to 5 years.
So, now that we have our Case Number, we definitely know it is going to be a Chapter 13. This means that we get to keep all of our real property (homes, land, etc) and personal property (vehicles, appliances, household goods, etc.), but will be making a monthly payment for the next 36 months. I do not know exactly how it works, but basically, in our situation, the Chapter 13 works just like a Chapter 7 (all unsecured debt is discharged), and the monthly payment goes to cover attorneys fees. We will not be responsible for any of our unsecured debt. None.
It really seems too good to be true.
Bankruptcy with no hardship? We get to keep our house (and corresponding mortgage payment)? We get to keep our cars (and corresponding car payments)? But we'll be freed from the $45,000 credit card debt? And we didn't even have to come up with $3,000 attorney fees up front? You mean the attorney fees are payable after our debts are discharged? Well, that last bit isn't true - our first monthly installment is actually due on August 1st, which seems weird to me, considering we haven't even gone to court yet. But, at least it makes me feel like we're actually making progress.
Oh yes, and the collection calls should be cut in half now. We answered the phone tonight so we could give them the Case Number and our attorney's phone number. Once they have been notified of the Bankruptcy Case Number, it is illegal for them to continue calling.
Two creditors down, only three more to go.
Mr. America and I still can't get over just how easy this entire process has been so far. I keep waiting for a 'shocker' of some kind - something that stops me dead in my tracks and makes me regret this entire decision. It's almost like buying a house, in many ways. First, there's the paperwork. Sign this, sign that, sign this, and this, and this, and this. Then, there's the whole disbelief aspect, where you won't actually believe the house is yours until you have the keys and are standing in your living room for the very first time. I don't think we'll really believe the bankruptcy has gone through until we pull our credit reports and see proof, and that could be another several months from now, even if our court date was tomorrow.
I know I haven't mentioned what type of Bankruptcy we're filing, but that's because we weren't entirely sure exactly which Chapter the attorney was going to 'recommend.' We were given a pretty good idea, but it was really up to the attorney. There are two Chapters, 7 and 13. The simple Chapter 7 explanation is that it eliminates all of your debt, but also forces you to sell everything of value. The simple Chapter 13 explanation is that it is basically an interest-free unsecured debt consolidation loan (no real or personal property is covered) handled by the U.S. Bankruptcy Court, with a monthly payment required for up to 5 years.
So, now that we have our Case Number, we definitely know it is going to be a Chapter 13. This means that we get to keep all of our real property (homes, land, etc) and personal property (vehicles, appliances, household goods, etc.), but will be making a monthly payment for the next 36 months. I do not know exactly how it works, but basically, in our situation, the Chapter 13 works just like a Chapter 7 (all unsecured debt is discharged), and the monthly payment goes to cover attorneys fees. We will not be responsible for any of our unsecured debt. None.
It really seems too good to be true.
Bankruptcy with no hardship? We get to keep our house (and corresponding mortgage payment)? We get to keep our cars (and corresponding car payments)? But we'll be freed from the $45,000 credit card debt? And we didn't even have to come up with $3,000 attorney fees up front? You mean the attorney fees are payable after our debts are discharged? Well, that last bit isn't true - our first monthly installment is actually due on August 1st, which seems weird to me, considering we haven't even gone to court yet. But, at least it makes me feel like we're actually making progress.
Oh yes, and the collection calls should be cut in half now. We answered the phone tonight so we could give them the Case Number and our attorney's phone number. Once they have been notified of the Bankruptcy Case Number, it is illegal for them to continue calling.
Two creditors down, only three more to go.
Tuesday, July 28, 2009
Updated Call Log
Thursday, July 23
8:46 am
8:49 am
9:54 am
11:03 am
1:51 pm
2:59 pm
4:07 pm
4:32 pm
8:45 pm
Friday, July 24
8:09 am
12:57 pm
1:40 pm
2:51 pm
4:10 pm
4:47 pm
6:25 pm
6:30 pm
Saturday, July 25
8:14 am
9:57 am
11:33 am
12:50 pm
2:58 pm
3:51 pm
4:38 pm
5:46 pm
7:40 pm
8:52 pm
Sunday, July 26
11:51 am
2:09 pm
2:50 pm
3:51 pm
4:50 pm
5:49 pm
6:11 pm
8:22 pm
Monday, July 27
8:13 am
6:01 pm
6:28 pm
8:46 am
8:49 am
9:54 am
11:03 am
1:51 pm
2:59 pm
4:07 pm
4:32 pm
8:45 pm
Friday, July 24
8:09 am
12:57 pm
1:40 pm
2:51 pm
4:10 pm
4:47 pm
6:25 pm
6:30 pm
Saturday, July 25
8:14 am
9:57 am
11:33 am
12:50 pm
2:58 pm
3:51 pm
4:38 pm
5:46 pm
7:40 pm
8:52 pm
Sunday, July 26
11:51 am
2:09 pm
2:50 pm
3:51 pm
4:50 pm
5:49 pm
6:11 pm
8:22 pm
Monday, July 27
8:13 am
6:01 pm
6:28 pm
Monday, July 27, 2009
Doubt Lingers
Mr. America is running on the doubtmill. To be honest, I have been too. Part of it is guilt, the other part is the unknown of what the future holds for a couple that has gone bankrupt.
We are well aware of the blemish that will remain on our credit for the next 10 years. After 10 years it is no longer listed on the credit report, but we will be forever responsible for disclosing it in the event we are asked about bankruptcy.
The other unknown that concerns us? Employment.
Research has shown me that some job applications do ask that you disclose bankruptcy information. This is understandable if you're going to be a bank teller or someone that deals closely with money on a daily basis. As far as current employment, it is illegal to fire you because of bankruptcy. Future employment is a little more sketchy.
It seems that if you apply in the private sector, they *may* discriminate based on the bankruptcy. If you apply in the government sector, they are prohibited from discriminating based on the bankruptcy.
Neither of us plan on making job changes anytime soon, so I don't think we really have anything to worry about. Therein lies the issue...
It's the unknown that causes the most uncertainty about this whole bankruptcy decision.
We are well aware of the blemish that will remain on our credit for the next 10 years. After 10 years it is no longer listed on the credit report, but we will be forever responsible for disclosing it in the event we are asked about bankruptcy.
The other unknown that concerns us? Employment.
Research has shown me that some job applications do ask that you disclose bankruptcy information. This is understandable if you're going to be a bank teller or someone that deals closely with money on a daily basis. As far as current employment, it is illegal to fire you because of bankruptcy. Future employment is a little more sketchy.
It seems that if you apply in the private sector, they *may* discriminate based on the bankruptcy. If you apply in the government sector, they are prohibited from discriminating based on the bankruptcy.
Neither of us plan on making job changes anytime soon, so I don't think we really have anything to worry about. Therein lies the issue...
It's the unknown that causes the most uncertainty about this whole bankruptcy decision.
Wednesday, July 22, 2009
Update on the Collection Calls
Both of my credit cards have begun calling. Considering this, the frequency seems low compared to last week!
Wednesday, 07-15
1:04 pm
8:25 pm
Thursday, 07-16
5:06 pm
6:11 pm
Friday, 07-17
5:42 pm
Saturday, 07-18
12:28 pm
Sunday, 07-19
10:46 am
4:23 pm
4:58 pm
6:13 pm
7:02 pm
7:40 pm (I answered this call and the representative mispronounced my name, so I said, "I'm sorry, there's no one here by that name." He asked, "Can you verify that for recording purposes?" I said, "Sure, there's no one here by the name *insert mispronounced name.*" He asked again, "There is no *insert mispronounced name* there?" I repeated, "There is no one here by the name *insert mispronounced name." He said, "Thank you." I hung up.)
Monday, 07-20
3:54 pm
Tuesday, 07-21
1:00 pm
4:52 pm
5:33 pm
6:48 pm
7:50 pm
Wednesday, 07-22
12:20 pm
1:24 pm
3:05 pm
4:54 pm
5:48 pm
6:17 pm
7:04 pm
7:13 pm
8:12 pm
Wednesday, 07-15
1:04 pm
8:25 pm
Thursday, 07-16
5:06 pm
6:11 pm
Friday, 07-17
5:42 pm
Saturday, 07-18
12:28 pm
Sunday, 07-19
10:46 am
4:23 pm
4:58 pm
6:13 pm
7:02 pm
7:40 pm (I answered this call and the representative mispronounced my name, so I said, "I'm sorry, there's no one here by that name." He asked, "Can you verify that for recording purposes?" I said, "Sure, there's no one here by the name *insert mispronounced name.*" He asked again, "There is no *insert mispronounced name* there?" I repeated, "There is no one here by the name *insert mispronounced name." He said, "Thank you." I hung up.)
Monday, 07-20
3:54 pm
Tuesday, 07-21
1:00 pm
4:52 pm
5:33 pm
6:48 pm
7:50 pm
Wednesday, 07-22
12:20 pm
1:24 pm
3:05 pm
4:54 pm
5:48 pm
6:17 pm
7:04 pm
7:13 pm
8:12 pm
Credit Counseling
Last night we completed the mandatory, pre-filing credit counseling. It wasn't an entirely long process, because the attorney gave us a worksheet to fill out, so we had all the answers right in front of us as we went through the counseling.
This is the outcome of the counseling:
You have overspent or made poor choices. It can be hard to face and admit, but everyone makes mistakes. 'To err is human.' It is always better to recognize and deal with your mistakes than to pretend nothing is wrong (denial) or ignores the problem until it becomes a crisis (lawsuits, wage garnishment, etc.). Avoid 'beating yourself up' or feelings that you are a failure, a bad person, etc. Remember, everyone makes mistakes and it takes courage to recognize them and deal with them! The key is to determine why you got into debt so that you can avoid making the same mistake in the future. There are many excellent resources to give you the financial knowledge you probably did not learn in school. Hummingbird offers a great deal of free information as well as a list of other resources.
You have experienced an increase in your expenses. When your financial well-being is affected, it is wise to consider all options. There are usually more options than you might first think. Limit your non-essential spending. Then create a new spending plan or budget and try to balance it using your new expenses. Look for ways to increase your income. For example, a part-time job or overtime on your present job may help. Please keep our money saving tips page handy as a reference source when balancing your budget.
Re-examine your total financial picture. Do you see any possibilities to increase your income? Are there ways to reduce your expenses? Brainstorming is a great way to come up with possibilities. Get two pieces of paper. On the first piece of paper, write down any and every idea to increase income. On the second, write down any and every idea to decrease expenses. If only one idea helps you're better off then when you started.
If you receive substantial tax refunds each year, it means that the government has had the use of your money all year instead of you. It may be helpful to talk to someone in your payroll office to find out if you can change your tax exemptions so that you still have enough taken out so that you do not owe taxes, but you get a smaller refund. This will put more money in your pocket.
This morning, I have to fax over a few last-minute items to the paralegal and that should be all until we have our final meeting with the attorney next week, which is the same day our case will be filed with the Bankruptcy Court.
This is the outcome of the counseling:
Analysis of Consumer's Financial Situation
When a loss of income has affected your finances take a good look at your total financial picture. Limit your non-essential spending. Then create a new spending plan or budget and try to balance it using your new income. Look for ways to increase your income. For example, a part-time job or overtime on your present job may help. Please keep our money saving tips page handy as a reference source when balancing your budget.You have overspent or made poor choices. It can be hard to face and admit, but everyone makes mistakes. 'To err is human.' It is always better to recognize and deal with your mistakes than to pretend nothing is wrong (denial) or ignores the problem until it becomes a crisis (lawsuits, wage garnishment, etc.). Avoid 'beating yourself up' or feelings that you are a failure, a bad person, etc. Remember, everyone makes mistakes and it takes courage to recognize them and deal with them! The key is to determine why you got into debt so that you can avoid making the same mistake in the future. There are many excellent resources to give you the financial knowledge you probably did not learn in school. Hummingbird offers a great deal of free information as well as a list of other resources.
You have experienced an increase in your expenses. When your financial well-being is affected, it is wise to consider all options. There are usually more options than you might first think. Limit your non-essential spending. Then create a new spending plan or budget and try to balance it using your new expenses. Look for ways to increase your income. For example, a part-time job or overtime on your present job may help. Please keep our money saving tips page handy as a reference source when balancing your budget.
Re-examine your total financial picture. Do you see any possibilities to increase your income? Are there ways to reduce your expenses? Brainstorming is a great way to come up with possibilities. Get two pieces of paper. On the first piece of paper, write down any and every idea to increase income. On the second, write down any and every idea to decrease expenses. If only one idea helps you're better off then when you started.
If you receive substantial tax refunds each year, it means that the government has had the use of your money all year instead of you. It may be helpful to talk to someone in your payroll office to find out if you can change your tax exemptions so that you still have enough taken out so that you do not owe taxes, but you get a smaller refund. This will put more money in your pocket.
Analysis of Living Expenses
Your percentage of your income spent on housing and utilities is above average. Compare home and auto insurance policy rates. Often if you insure home and auto with the same company you can save money. Can you save on your utility bills by being more energy conscious and sealing home leaks? If you are paying PMI (private mortgage insurance), call your mortgage company to see if it's still necessary. Can you reduce telephone, cell phone or Internet costs by reducing the level of service or shopping for a better deal? Expenses included in this category are: Mortgage or rent, homeowner's or renter's insurance, utilities other than cable and satellite, HOA dues, Lot rent, and real estate taxes if not included in mortgage.Your percentage of income spent on transportation is above the average. Some ways to reduce spending in this area are to take public transportation where possible, share rides, car pool, and shop for better insurance rates. Often if you insure home and auto with the same company you can save money. Expenses included in this category are: Vehicle payments, public transportation, tolls, parking, gas, oil, maintenance, licensing costs, vehicle tax and auto insurance.
The amount you spend on food and other groceries is above the average. Do you have special circumstances such as a more expensive diet for medical reasons or several young children requiring diapers and formula? If so, your percentage in this category may be understandably higher. Some ways to reduce your food costs are to use coupons, take advantage of grocery store specials or discount cards, pack meals eaten at work or school and buy produce when it is in season. Expenses included in this category are: Groceries, baby expenses such as diapers, and school lunches.
The percentage of income you spend on entertainment is above the average. This is the area in which you have the most ability to reduce expenses. Some ideas for reductions are to check your local library for books, movie rentals or entertainment for children at no cost. If you eat out, buy take out foods or order food in, reduce the number of times that you do so to achieve your financial goals. Cable and satellite services can also be reduced. If you use tobacco or alcohol, reducing or eliminating your usage will save money. Expenses included in this category are: Entertainment, dining out, cable, satellite, alcohol, tobacco, newspapers, magazines, health club or gym, and children's activities.
Your percentage of income spent in the “other” category is above average. Note that this category normally includes payment of credit card and other unsecured debt, but no such debt payments have been added to your “other” category. Is there any place you can reduce expenses here? Expenses included in this category are: Personal grooming, pets, education expenses, child daycare, life insurance, other insurance, alimony and child support payments, student loans, personal property taxes, savings, and charitable contributions. Ideally, savings should be 5-10% of your take-home income.
Budget Analysis
Assuming all of the information you have given so far is true and correct, after paying all of your living expenses and debts, you will either break even, or have negative $-1568.66 at the end of the month. That means that you will have -1568.66 dollars less than what you need to pay living expenses and your debts and will have no money at all left for unexpected expenses or emergency savings.You have substantially less than you need for your living expenses and payment on your debts. Your situation is generally considered to be one of financial crises. Seek professional legal and financial advice as soon as possible.
*****AS IF THIS WAS A SURPRISE!*****This morning, I have to fax over a few last-minute items to the paralegal and that should be all until we have our final meeting with the attorney next week, which is the same day our case will be filed with the Bankruptcy Court.
Tuesday, July 14, 2009
The Collection Calls Have Begun!
My credit card payments are due within the first few days of the month. With the exception of February 2004, when I had the flu and the last thing on my mind was paying my bills, I have never been late with my payments.
We were instructed to stop paying on the credit cards once we decided we were going forward with the bankruptcy. In all honesty, if we were going to pay the attorney's fees, we were going to have to skip the credit card payments, because we didn't have that much extra cash laying around.
So anyway, of the 5 credit cards we have, the one with the smallest balance ($2,500) has begun hounding me as if I owe them $2.5 million. My payment was due July 3rd, and on July 10th, the calls started.
Friday, 07-10
9:36 am
5:47 pm
Saturday, 07-11
8:03 am
8:47 am
12:07 pm
1:54 pm
2:38 pm
3:26 pm
4:39 pm
5:40 pm
5:57 pm
6:44 pm
7:53 pm
8:37 pm
Sunday, 7-12
11:14 am
1:57 pm
2:38 pm (I answered this call and when he mispronounced my name, I told him, "I'm sorry, you have the wrong number.")
3:53 pm (I answered this call and when she told me they have my bank account information and she'd be happy to take my payment over the phone, I told her, "You know what? It's Sunday. I'm spending time with my family. If you'll call back during a week day, we can discuss business at that time.")
Monday, 7-13
Apparently they take Monday off.
Tuesday, 7-14
12:58 pm
2:39 pm
3:32 pm
4:27 pm
7:02 pm
7:50 pm
8:47 pm
They are relentless! And I'm only two weeks late!
We were instructed to stop paying on the credit cards once we decided we were going forward with the bankruptcy. In all honesty, if we were going to pay the attorney's fees, we were going to have to skip the credit card payments, because we didn't have that much extra cash laying around.
So anyway, of the 5 credit cards we have, the one with the smallest balance ($2,500) has begun hounding me as if I owe them $2.5 million. My payment was due July 3rd, and on July 10th, the calls started.
Friday, 07-10
9:36 am
5:47 pm
Saturday, 07-11
8:03 am
8:47 am
12:07 pm
1:54 pm
2:38 pm
3:26 pm
4:39 pm
5:40 pm
5:57 pm
6:44 pm
7:53 pm
8:37 pm
Sunday, 7-12
11:14 am
1:57 pm
2:38 pm (I answered this call and when he mispronounced my name, I told him, "I'm sorry, you have the wrong number.")
3:53 pm (I answered this call and when she told me they have my bank account information and she'd be happy to take my payment over the phone, I told her, "You know what? It's Sunday. I'm spending time with my family. If you'll call back during a week day, we can discuss business at that time.")
Monday, 7-13
Apparently they take Monday off.
Tuesday, 7-14
12:58 pm
2:39 pm
3:32 pm
4:27 pm
7:02 pm
7:50 pm
8:47 pm
They are relentless! And I'm only two weeks late!
More Thoughts
One thing that confounds me about this entire Bankruptcy process is how easy it seems to be (so far). We've had to work our butts off just to gather all the documentation pertaining to our debts/assets, etc, but that's not a big deal - it just requires making copies of stuff that already exists - not much thought and introspection. I realize we've barely just begun and don't even have a case number yet, but the one question I've expected the most is:
"So, how did you get yourselves into this mess?"
I went into this process fully expecting to have to justify how we owe so much and why we think bankruptcy is the answer and why we deserve to have our debts discharged. We may get those questions later, but I would have thought it would have been one of the first questions asked. So far, it's all been about the means test and that's it.
Surely it can't be this easy, can it?
Before we even contemplated filing for Bankruptcy, I bought Dave Ramsey's Total Money Makeover. I was all ready to get started on the debt Snowball, but the first step in Dave's plan is to create your $1,000 emergency fund. We couldn't even do that! The bills ate every single penny we brought home and we fell back on the credit cards for other expenses (gas, groceries, etc). We were surviving on the minimum payment buffer for a few months, and in the first week of June, we charged every single one of our credit cards to their limits. I wasn't paying attention and didn't take into consideration the upcoming finance charges, so not only were we maxed out, but the finance charges put us over our limits and we got charged with corresponding fees.
And that is when we realized we were in over our heads and the 'B' word came up. We discussed it and we each thought about it for a few days before finally making the appointment for the free consultation.
In regard to Dave Ramsey's plan, my logic this far is: But *he* filed for Bankruptcy! We can too! Sad, but true. Also, if it's Dave's plan for us to never have to rely on credit again, what does it matter if we have 10 years of bad credit? We don't intend on using it anyway! That's why we're filing for bankruptcy, so we can free ourselves from the debt chains and live on a cash basis from here on out. It's the Dave Ramsey plan, just 4 years faster and without the financial stress of putting every single extra dollar toward debt.
And then there is the other side of the coin - it's our debt and we are ultimately responsible (or irresponsible, however you'd like to look at it) for our actions. It isn't fair that we can just walk away from our responsibility to repay our debt. I feel guilty.
That's when I think about the laws that make bankruptcy legal and acceptable. I know our lawyer is raking in the dough, especially in this economy.
We are not alone.
"So, how did you get yourselves into this mess?"
I went into this process fully expecting to have to justify how we owe so much and why we think bankruptcy is the answer and why we deserve to have our debts discharged. We may get those questions later, but I would have thought it would have been one of the first questions asked. So far, it's all been about the means test and that's it.
Surely it can't be this easy, can it?
Before we even contemplated filing for Bankruptcy, I bought Dave Ramsey's Total Money Makeover. I was all ready to get started on the debt Snowball, but the first step in Dave's plan is to create your $1,000 emergency fund. We couldn't even do that! The bills ate every single penny we brought home and we fell back on the credit cards for other expenses (gas, groceries, etc). We were surviving on the minimum payment buffer for a few months, and in the first week of June, we charged every single one of our credit cards to their limits. I wasn't paying attention and didn't take into consideration the upcoming finance charges, so not only were we maxed out, but the finance charges put us over our limits and we got charged with corresponding fees.
And that is when we realized we were in over our heads and the 'B' word came up. We discussed it and we each thought about it for a few days before finally making the appointment for the free consultation.
In regard to Dave Ramsey's plan, my logic this far is: But *he* filed for Bankruptcy! We can too! Sad, but true. Also, if it's Dave's plan for us to never have to rely on credit again, what does it matter if we have 10 years of bad credit? We don't intend on using it anyway! That's why we're filing for bankruptcy, so we can free ourselves from the debt chains and live on a cash basis from here on out. It's the Dave Ramsey plan, just 4 years faster and without the financial stress of putting every single extra dollar toward debt.
And then there is the other side of the coin - it's our debt and we are ultimately responsible (or irresponsible, however you'd like to look at it) for our actions. It isn't fair that we can just walk away from our responsibility to repay our debt. I feel guilty.
That's when I think about the laws that make bankruptcy legal and acceptable. I know our lawyer is raking in the dough, especially in this economy.
We are not alone.
Questionnaire Finished
Questionnaire Finished
We've jumped another hurdle on this Bankruptcy journey. The 44+ page questionnaire has been completed and turned in to the attorney's office. It was basically a precise inventory of our income, expenses, assets, and debts. Very involved and in-depth, but that's to be expected. The calculations show that we bring home $7,500 monthly before taxes/deductions. After taxes/deductions? We really only bring home about $6,000. Our monthly expenses can be as much as $5,630 each month (and this doesn't even include the $1,000+ credit card payments we hope to be rid of if the bankruptcy goes through). Even with the Bankruptcy, we will need to make some serious changes in our lifestyle.
There are a few documents we were unable to find prior to yesterday's appointment, but we have about a week to get them in before our papers are officially filed with the Bankruptcy Court, which should be by the end of July. Another thing we have to do before papers are filed is complete the online credit counseling. I'll have to get Mr. America to sit with me and run through the class sometime this weekend. The attorney gave us a worksheet that will make it easy to complete the credit counseling, instead of having to scramble for figures, etc. Given the income and expenses previously mentioned, I think the credit counseling is a great idea, aside from the fact that it's required.
The paralegal told me that our court date would be within 25 days of our file date, so sometime in August we'll go to court. After that, I don't know what happens. More importantly, what happens IN court, I have no idea. Will we be grilled? Will they find something that makes us ineligible? I don't know what they could find, because we listed everything that we know of - I just fear that we don't owe enough or perhaps make too much money, whatever it might be to get in our way of filing.
We've jumped another hurdle on this Bankruptcy journey. The 44+ page questionnaire has been completed and turned in to the attorney's office. It was basically a precise inventory of our income, expenses, assets, and debts. Very involved and in-depth, but that's to be expected. The calculations show that we bring home $7,500 monthly before taxes/deductions. After taxes/deductions? We really only bring home about $6,000. Our monthly expenses can be as much as $5,630 each month (and this doesn't even include the $1,000+ credit card payments we hope to be rid of if the bankruptcy goes through). Even with the Bankruptcy, we will need to make some serious changes in our lifestyle.
There are a few documents we were unable to find prior to yesterday's appointment, but we have about a week to get them in before our papers are officially filed with the Bankruptcy Court, which should be by the end of July. Another thing we have to do before papers are filed is complete the online credit counseling. I'll have to get Mr. America to sit with me and run through the class sometime this weekend. The attorney gave us a worksheet that will make it easy to complete the credit counseling, instead of having to scramble for figures, etc. Given the income and expenses previously mentioned, I think the credit counseling is a great idea, aside from the fact that it's required.
The paralegal told me that our court date would be within 25 days of our file date, so sometime in August we'll go to court. After that, I don't know what happens. More importantly, what happens IN court, I have no idea. Will we be grilled? Will they find something that makes us ineligible? I don't know what they could find, because we listed everything that we know of - I just fear that we don't owe enough or perhaps make too much money, whatever it might be to get in our way of filing.
Monday, July 13, 2009
Here We Go
We have spent the past few days filling out the 44+ pages worth of paperwork, all in preparation for our third visit to the Bankruptcy Attorney's office.
06/19/09: The first visit was just informative - we basically got verbal confirmation that we indeed qualify for bankruptcy consideration. We walked away with several questions that we needed to research further, but were able to make a decision within a week, at which point I called to set up the second appointment.
06/26/09: At the second visit we paid a retainer fee of $75 and signed a bunch of paperwork. We also got a lot more paperwork to bring home and fill out before our next appointment, which is tomorrow (at this hour, it's technically later this morning). It has been a challenge trying to find time to sit down with Mr. America and get everything down on paper. I thought we were broke before thinking about filing for bankruptcy, but laying out all the income and expenses on paper, even without all the credit card debt, we're projected to still be spending almost as much as we make.
Hmmmmm. Perhaps the mandatory credit counseling will do us some good after all?
Being that we're still in the beginning stages of this bankruptcy process, I really don't have any specific questions aside from, "How does this whole thing work?"
That's why we've started this blog. After tomorrow's (today's) appointment, the ball ought to be rolling fairly quickly (at least quicker than it's been moving so far), and we should have more to update about, especially more specifics about the whole process - I'd love for this to be a learning experience for anyone else that might need the insight or information.
06/19/09: The first visit was just informative - we basically got verbal confirmation that we indeed qualify for bankruptcy consideration. We walked away with several questions that we needed to research further, but were able to make a decision within a week, at which point I called to set up the second appointment.
06/26/09: At the second visit we paid a retainer fee of $75 and signed a bunch of paperwork. We also got a lot more paperwork to bring home and fill out before our next appointment, which is tomorrow (at this hour, it's technically later this morning). It has been a challenge trying to find time to sit down with Mr. America and get everything down on paper. I thought we were broke before thinking about filing for bankruptcy, but laying out all the income and expenses on paper, even without all the credit card debt, we're projected to still be spending almost as much as we make.
Hmmmmm. Perhaps the mandatory credit counseling will do us some good after all?
Being that we're still in the beginning stages of this bankruptcy process, I really don't have any specific questions aside from, "How does this whole thing work?"
That's why we've started this blog. After tomorrow's (today's) appointment, the ball ought to be rolling fairly quickly (at least quicker than it's been moving so far), and we should have more to update about, especially more specifics about the whole process - I'd love for this to be a learning experience for anyone else that might need the insight or information.
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