Anne wrote me through the GetOutofDebt.org site and asked for help. You can write me also and ask for help.
Anne says “I have a large debt load and I am unable to make the payments. I have been on short term disability for eight weeks which has made an already difficult time even worse.
Some of the creditors have already sent the debt to collection agencies. I own my own home and at this point I have only kept up the mortgage payment and utilities. I am going crazy with worry. I have not paid up my oil bill from last winter and will soon need oil. There is little equity in the house so remortgaging is not an option. I have it up for sale.
Please tell me if there is any hope of getting out of this mess without going bankrupt.”
I wish I was there to wrap my arms around you and give you a big bear hug. These are difficult times and now with your heavy financial worries, it makes the entire situation so stressful. But don’t worry, you are a good person, just in a bad situation. You are not a failure.
Your situation sounds so common, an unexpected reduction in income leads to a snowball of growing debt that is or seems unserviceable. In your case your medical situation has thrown you under the bus but that’s not what really caused the tipping point, is it?
Your situation has been brewing for some time, especially with a not fully paid oil bill from last winter. I suspect that you’ve been just making ends meet before the recent disability. The disability just amplified the fact that you had no financial reserves to weather the debt storm. That doesn’t make you a bad person, just more typical than people believe.
Seeing how there is little equity in the house, isn’t a bad thing in this situation. If there was more equity in the home and you did borrow against it, the chances are that it would just stall dealing with the underlying issues.
My priorities for you are a roof over your head and oil in the furnace first. While bankruptcy won’t make magic money appear in your bank account now, it will when you get back to work and off disability. That money you can use to get the bill paid up and prepare to face a cold and expensive winter. Fuel bills will be much higher this year, than last.
Some might offer advice that this is a short term event and that you will emerge out of in your disability at some point in the future and that then you can regroup and deal with the past due debt. You could but my honest and from the heart opinion would be that would be a waste of time and do nothing to reduce your fear and stress levels.
Worry and stress do nothing to help you recover from your disability. The fear of debt and uncertainty of what tomorrow will bring can create an emotional situation that is almost unbearable. And for some, it is unbearable, and they kill themselves.
There is little anyone can say to snap you out of the mental anguish of debt worry. The fact that you are worrying about it just tells me that is the type of person that you are. Some internalize more than others. Some never let issues like this worry them and I wish I was one of those people at times in my life.
The only thing that will stop the collection agencies, protect your house, and eliminate the worry is going to be nothing less than bankruptcy. Based on what you have told me and what my years of experience tell me, bankruptcy is the most logical solution that will address all of your issues and allow you the best chance of recovery.
Bankruptcy comes with baggage as well. It is the emotional baggage that “I failed”. I lived through that. I felt like an utter failure when I went bankrupt but don’t let those emotions stand in your way of doing the responsible thing here, going bankrupt.
Feelings of failure will not keep the roof over your head nor will they fire the furnace this winter. Based on your situation, bankruptcy is the most responsible path to follow at the moment. If you feel you need to go back and repay your creditors after bankruptcy, you can.