Out Of Options

[TLynn12]

What is the name of your state? NY

My situation is the following;

-We own a home with a tax value of 55k, home equaity appraisal of 89k
-We own two cars, both older than 10 years old.
-My husband has a small amount (under 2k) in a 401k that we can not borrow against
& his income is approx. 2600 a month

We owe
-nothing on either car.
-16k on a home equity loan
-about 6k in credit card debit (all are in collections)
-1 year of property taxes (2,500)


My qustion is, if we file together, will be able to keep our home? (I'm confused on how much equity we are allowed)

What about our cars? (neither is worth more than the 2,400 allowed)


We tried to get a consoldation loan, but our credit scores are too low because of the credit card/collection accounts. We have just gotten to a point where we feel stuck and with non-stop calls from the collection agencies, we are at the the end of our rope. Also, add in that now our mortgage company is on us about the property taxes that are past due and it makes for a situation where we feel we can't win. (Our kids are starting to see the stress in us)

Any info would be appreciated. We are both young (under 40) and feel that we really have no other options.What is the name of your state?

[Ozark_Sophist]

I'm not sure why you would want to file for bankrupcy in your position. Have you talked to a free credit counselor at one of those consumer credit counseling agencies? The fine folk at these agencies (the free ones) have the ability to contact your credit card companies to set up a payment plan and reduce interest rates. Also, engaging the services of a credit counseling agencies will stop the creditor calls under the AFDCA.

Your total debt is $16,000 (home equity) + $2,500 (Property tax) + $6,000 (credit cards) = $24,500. Your income (1 income) is $2600. You should have easily have room for a payment plan.

If not, a second part-time job for your husband or for you (while he is at work to avoid day care costs) should increase your monthly income by at least $600 - all of which could go to paying off your debt.

Unless you have other debt, the second part time job plus what you are paying now could make you debt free in less than two years. Your credit would rebuild much faster this way.

[TLynn12]

Originally Posted by Ozark_Sophist

I'm not sure why you would want to file for bankrupcy in your position. Have you talked to a free credit counselor at one of those consumer credit counseling agencies? The fine folk at these agencies (the free ones) have the ability to contact your credit card companies to set up a payment plan and reduce interest rates. Also, engaging the services of a credit counseling agencies will stop the creditor calls under the AFDCA.

Your total debt is $16,000 (home equity) + $2,500 (Property tax) + $6,000 (credit cards) = $24,500. Your income (1 income) is $2600. You should have easily have room for a payment plan.

If not, a second part-time job for your husband or for you (while he is at work to avoid day care costs) should increase your monthly income by at least $600 - all of which could go to paying off your debt.

Unless you have other debt, the second part time job plus what you are paying now could make you debt free in less than two years. Your credit would rebuild much faster this way.

Thank you for your reply. We have considered credit counseling, we were researching them to find a legitimate one when our mortgage company hit us with the notice that we must provide proof of payment within 30 days on our past due taxes or they will default on our loan. Even with my husband working over time recently, we can't come up with that kind of money in a matter of weeks.


We intially got behind last year when my husband was layed off for three months, since then we have managed to pay off several smaller debts, but the larger ones don't seem to want to work with us. (full payment only or we sue) Now we have a fresh school tax bill waiting and we just seem to be in a cycle that has no end in sight. (we save a little to pay off a bill, then a car breaks down, one of the kids gets hurt, etc.) After a year of this, we are just feeling like we are hurting ourselves more by waiting.

Thank you

Also, I have not worked for years and can not find a job. (have been actively hunting for months)

[Ladynred]

Well, for one thing the property taxes probably won't be dischargable.

If you file jointly, the home equity exemption in NY is 50K, so as long as your EQUITY is under that, your house is safe. Can you afford to pay the taxes if you weren't already behind ?

Get a trade-in value on the 2 cars and find out how much you could exempt. Chances are pretty good the Trustee wouldn't touch either of them , 10 year old cars won't sell at auction for anything worth the Trustee's time.

[bigun]

Also, I have not worked for years and can not find a job. (have been actively hunting for months)


Honestly, have you tried WalMart, Target, MacDonalds, etc. You need income and this is no time to be picky.
You won't be able to discharge that equity line of credit and keep your home and as LNR posted, it's likely the property tax bill won't get discharged either. The only relief will be the $6K in cc debt.
BK isn't the answer. More income is the way out of this hole.

[debtcollector`]

Sell one of the cars. Pay the property tax and get a job.

Problem solved.


DC

[TLynn12]

Originally Posted by debtcollector`

Sell one of the cars. Pay the property tax and get a job.

Problem solved.


DC

To those who were respectful, thank you for your advice.


As for "debtcollector" , Not to be nasty, but you make it sound so easy, as if these concepts never entered our minds.

Would you like to buy our 11 year old car for 2,500? By the way, it has a leak in the gas tank, needs new brakes, a new front headlight housing and won't pass NY state inspection. (for good reason since it is unsafe) . The repairs will only cost you 1,500 to get it up to par so for the low price of 4,000 you can have an 11 year old car with 200k miles that is still only worth about 1,200. It's a great deal, right?

How about we sell that other car? Oh wait, my husband needs it to go to work and besides, that car is only worth 1,000 itself. But hey, it only takes 45 minutes for him to drive to work, he can walk that in a couple of hours, no problem, right?

And as for this housewife getting a job. Why haven't I since they are so easy to come by? My area of NY is just over filled with jobs for those of us with no real work history. It is after all, completely my fault that Walmart would rather hire the 20 year old with no interest in pesky things like medical ins. than a middle-aged woman with medical probelms who can only work nights and weekends since her husband already works 11 hour days.


So please don't judge me like I'm some housewife who is sitting on her butt while her husband tries to dig us out of debt created from my over spending. That is the farthest thing from the true. We live a frugile life style compared to most & were doing okay until he got layed off.

I'm just saying, sometimes things are not as clear cut as you might think. We are in over our heads, we know it is our faults and we tried to find other solutions before this.

We are ultimately paying for the simple mistake of not saving for that rainy day and I just don't see why my children should ultimately suffer the loss of their home over something they had no control over.

[Ozark_Sophist]

Again, call a consumer credit counseling agency. A reasonable plan is doable in your situation. At least get some professional advice. If they feel bankrupcy is an option, they will tell you. Good luck.

[TLynn12]

Originally Posted by bigun

Also, I have not worked for years and can not find a job. (have been actively hunting for months)


Honestly, have you tried WalMart, Target, MacDonalds, etc. You need income and this is no time to be picky.
You won't be able to discharge that equity line of credit and keep your home and as LNR posted, it's likely the property tax bill won't get discharged either. The only relief will be the $6K in cc debt.
BK isn't the answer. More income is the way out of this hole.

It is not a matter of being picky, it's a matter of not being able to compete with the twenty younger people wanting the same jobs that have no work hour restrictions.

[GulfBreeze]

Originally Posted by TLynn12

Also, I have not worked for years and can not find a job. (have been actively hunting for months)

maybe you are being too picky about what job you are applying at.

there are jobs out there...maybe not the one you are wanting. you have not worked in awhile, so start low....fast food place, maid, paper route...etc. heck, even babysitting. or worst yet, picking up beer cans....lol

[TLynn12]

Originally Posted by Ozark_Sophist

Again, call a consumer credit counseling agency. A reasonable plan is doable in your situation. At least get some professional advice. If they feel bankrupcy is an option, they will tell you. Good luck.

That is what we did today. Called a friend of the family who is a bankruptcy lawyer and who is familar with our finacial situation. He recommended a counseling service, but with the property tax situation, he is not sure if we will be able to avoid bankruptcy.

[TLynn12]

Originally Posted by GulfBreeze

maybe you are being too picky about what job you are applying at.

there are jobs out there...maybe not the one you are wanting. you have not worked in awhile, so start low....fast food place, maid, paper route...etc. heck, even babysitting. or worst yet, picking up beer cans....lol

I am not being picky at all, neither of us has ever been when it comes to employment. I once cleaned horse stalls for a local farmer when we needed the extra cash so trust me, McDonalds is not beneath me. (It's actually a step up LOL)

The problem is there seems to be far to many able bodied young people fighting for these same jobs at McDonalds, Arby's, Burger King, Pizza Hut, WalMart, Target and the 30 or so other places I've applied.

[Ozark_Sophist]

Originally Posted by TLynn12

That is what we did today. Called a friend of the family who is a bankruptcy lawyer and who is familar with our finacial situation. He recommended a counseling service, but with the property tax situation, he is not sure if we will be able to avoid bankruptcy.

As was pointed out earlier, the property tax situation is probably not dischargeable.

[bigun]

Plus, that helo will survivr bk as well.
I'd just continue to apply. So what if you've applied at 30 places. All you need is one person to say yes. You never know when that'll happen.
WalMart, Target, all these retail chains are hiring seasonal workers now.Plus, I know for a fact that WalMart and Target have overnight crews. Keep applying and don't worry about benefits now. You need cash and you need it now.
Even if you didn't have these debts, you can't support a family on $2600 month in a state like NY with a high cost of living. The income issue will have to be addreseed sooner or later.

[GulfBreeze]

Originally Posted by TLynn12

I am not being picky at all, neither of us has ever been when it comes to employment. I once cleaned horse stalls for a local farmer when we needed the extra cash so trust me, McDonalds is not beneath me. (It's actually a step up LOL)

The problem is there seems to be far to many able bodied young people fighting for these same jobs at McDonalds, Arby's, Burger King, Pizza Hut, WalMart, Target and the 30 or so other places I've applied.

i find it hard to believe that someone finds it near impossible to find something that they could do for money. there are plenty of unfilled jobs out there...it is just a matter of looking for them and being able to present yourself in a matter that would make you wanted. if i wanted to...i could go out tomorrow morning and get a job before that evening....even if it was just washing cars at a used car lot, picking up trash etc at a mall, mowing neighbor's lawns, etc etc...30 places and no job offers? what are you doing, where are you going and how are you acting/looking? there surely must be a reason none of these 30 places wanted you...and its not because of younger people.