I have read most of what is on your web-site and none of your helps apply to us. We are currently probably over $22,000 in debt. It may not seem like a lot to you but to us it is enormous. We have NO car payments and haven’t for over almost 20 years. We pay cash for used junk boxes. Our mtg payment is $458.00/month and that is without tax and insurance, tack on about $125 to cover that. We cannot even rent a 2 bedroom apt for even near that. We have 7 children living at home. Our eldest son is in college on a free ride academic and financial scholarship. Our eldest daughter is married, so that is 6 children under the age of 18. We are 9 people living in an 1800 sq. foot home in a not so great neighborhood. There are several houses on our street in foreclosure so we probably couldn’t get what we paid for it at 97K about 11years ago. Selling is not an option. My husband use to have a fairly decent job but due to the fact this his boss was incompetent and did alot of things wrong, my husband was made the scape goat in 2006 and was fired. Up until then we were keeping our heads above water.
He worked two other jobs in his trade for about a year and a half but because he was under qualified for those positions, and they were the only ones offered to him, he basically lost them too. He went 8 months searching for a job with no success. Finally someone referred him to a completely different field as a 911-Telecommunicator and he was hired instantly. He is the best one we’ve been told over and over and they all love him there. This job paid less than half of what he was making in 2006, thus this is when it started to get bad. We had to use our credit card to buy things like hot-water heaters, car repair, dentist bills, doctor bills, gas, clothes and sometimes food. My husband got a second job at the same time as a pizza delivery man and that worked for a while until the recession hit and he couldn’t make what he spent in gas. He also at the same time was going to college full-time, on 100% financial aid and received his Bachelor’s Degree at 49 years old in May 2010. I was so proud of him. So he worked 2 jobs, studied full-time and raised 8 children.
We have no luxuries and have had NONE for years. I cut everyone’s hair including my own and no I am not trained. I have not been able to work because of his revolving schedule and no one else to care for the children nor take them to their extra-curricular activities like Marching Band, plays, girl scouts. Our children do not get private lessons or private school. We buy all our clothes at the good-will or get them free at church. Our home needs repair and so doesn’t our cars. We are down to one car now the other has no brakes.
We have not had a family vacation since January 2004. My husband saved all his spare change for 8 years and we took 4 days to go to Cincinnati for our 25th anniversary. It was the first time we had been alone in over 12 years. He managed to save just above $600 so that was our splurge. Nine days later, in July 2010 my husband had a stroke. It was minor and he recovered and is back to work but cannot work overtime too much because he is exhausted. The docs told him to stay out about 3 months but he went back after less than one because of our financial picture. We now have medical bills ranging in the 3K area. That is included in the 22K I referred to before. We are about to hit our limit on our credit card. We have made all payments up to date yet it is getting to the point now when we just don’t have enough at the end of the month and borrow from peter to pay paul. It is a cycle. I applied for food stamps immediately after my husband’s stroke and we got $687 per month in food stamps which has been a tremendous help. My kids are all on state-sponsored health insurance again, a tremendous help.
So where do we cut out? The yearly taxes are due at the end of this year and our home owners and car insurance and we don’t have it. I had always had it before but this year I do not.
We are considering defaulting on the credit card which is at $325/month now. Do you have any suggestions?
Desperate in KY
The good news is you’ve already looked into public benefit programs and you are getting those benefits. The solution here is very clear, you need to go bankrupt.
With your husband’s medical situation, the number of kids still at home, and the overall financial situation it is unlikely that if you went out to find part-time employment you’d be able to radically turn this situation around.
The more logical solution is for you to seek pro bono (free) bankruptcy help here. And since you are already on benefits you’d most likely quickly qualify for the free help to go bankrupt. The odds are pretty good you’d qualify for a Chapter 7 bankruptcy and your debt would be discharged in a few months.
Immediately after filing you would stop paying your creditors. You would then be able to save the $400 or so each month so you can buildup an emergency fund in a savings account.
At this point there is almost no further to fall. It’s time to stop slipping down the slope, take decisive action, and do the most responsible thing you can for your kids and go bankrupt to protect your family moving forward.