Sunday, January 03, 2016

Chapter 13 Bankruptcy

In keeping with my need to write, here is the second post of the year!  Woohoo!    This is very personal, and possibly more information than any of you ever wanted to know. 

Bankruptcy.  That’s something that happens to other people, and definitely not something you ever expect to happen to “you”.  In fact, the word itself conjures up images of people who are extremely irresponsible, people who have bought the best of everything and drive expensive cars, and people who try their best to keep up with the Smiths.  That’s the typical stereotype, right?  At least, that’s what most people think, until they meet “normal” people who are going through Bankruptcy.

Our story started well over a decade before we even stepped foot into the courtroom to file for bankruptcy.  I can remember years ago, back when DH and I worked in Frederick, he always took care of the finances and I would always ask him (beg him) to take some time to go over them with me.  He would always say that we'd go over it "this weekend"and assure me that everything was fine, but it would never happen.  I let this continuous loop run for far too long.

I’m not sure why I finally decided to run a credit check on both of us, other than I was tired of being kept in the dark about everything.  I was on break at work when I finally decided to check, and I’m pretty sure my co-workers remember that day just about as well as I do.  I was shocked when I saw the numbers.  So much so, that I sobbed out loud and then I called my husband.  I asked him “HOW?”  “WHY?” Then I yelled into the phone words which I had never said to him in our almost twenty years of marriage, “I HATE YOU!”

I could not believe the amount we were in debt.  I also couldn’t understand how it happened.  I never went shopping for clothes or shoes, I didn’t have a hobby, and I didn’t even buy music.  HOW DID THIS HAPPEN????  My head was spinning, I was a blubbering mess, so I took sick leave for the rest of the day and went home.  I think Frank left work early to meet me, which ended up being about the same time our son got home from school.  Poor kid had never heard us fight before that day.  In fact, as I yelled at DH, our son ran upstairs and locked himself in his room.

Within two hours of coming home that day, I went into “Save My Family” mode.  I found a legitimate program that offered services to assist people with debt management (Money Management International (MMI) http://www.moneymanagement.org/).  The counselor I talked to was very frank and upfront, indicating that we may end up having to file for bankruptcy; however, when I set my mind to something, I usually go full speed ahead.

I pulled as much money out of my 401(k) as I could to get us through for a little while, as our debt management program started.  I called all of the credit card companies, asking them to please work with me and accept smaller payments.  MOST of the credit card companies were willing to work with me.  I was adamant that we were going to pay back every single cent of the debt that was in our name.  I tried.  I tried so hard to make it work.  I even swallowed my pride and bought weekly groceries from Angel Food Ministries.  Talk about a change!  Going from organic groceries to, well, food just meant to provide nourishment to my family was a shock to say the least. I managed to make the required payments through MMI, but when I ended up with $40.00 to cover groceries and gas for two weeks, I knew I had to make a tough decision – bankruptcy.  

The first lawyer we met with was worthless.  As soon as I can find the paperwork from that company, I’ll post the name of that lawyer.  She basically told me to stop making payments on our house.  Uh… what???  Oh hell no!!  I was trying to do the RIGHT thing.  When we left her office, I felt confused and defeated.  I did a little more research and found an extremely reputable lawyer whose focus was on bankruptcy and actually HELPING people.  His name is Aaron Amore in Charles Town.  Before meeting with him, I bought a Bankruptcy for Dummies book (laugh, but it was extremely informative).  When we met with Amore, we had an idea of what to expect, but he explained everything even further.

Prior to our experience, I always thought “Bankruptcy” meant that all of your debt was wiped clean and you started fresh.  Talk about a wake-up call!  For “regular” people, there are actually two types of bankruptcy; Chapter 7 and Chapter 13, and who files for which one depends on salary and assets. Chapter 7 is a liquidation bankruptcy, and Chapter 13 is a reorganization bankruptcy.  We “qualified” for Chapter 13 bankruptcy, which meant we had to pay our debt back.  On top of our mortgage payment, our home equity loan payment, and our car payment, we also had to pay $2600 each month to a bankruptcy trustee for five years.  As soon as we started working with Amore, the creditors stopped calling and I felt like I could breathe again.  Financially, things were tight but we were managing.

For the better part of a year, I maintained a coolness with my DH.  I no longer thought of us as a married couple; rather, we were just people sharing a house.  If we could have afforded it, I would have asked him to leave.  I didn’t hide the way I felt, and he was painfully aware of it.  The difference, though, between DH and most people in this situation, is that he changed.  He truly took responsibility for his actions and changed.  He took a second job at WalMart to help make ends meet before our bankruptcy, he only used whatever cash I gave him on a weekly basis, and he finally started to view me with respect.

Many people have asked what he spent our money on, expecting something juicy or exciting.  Truthfully, DH just got caught up in credit cards.  He did buy himself whatever he wanted.  Usually, it was music, baseball items, baseball gear for our son (i.e. $500 bats), etc.  Much of my resentment toward my DH during this time, was based on the fact that I never spent money on myself prior to the bankruptcy and he had no problem spending money on himself.  It took a while for me to get over that, but I think I finally have.  :)
 
About a year and half after all of this transpired, I realized my animosity was starting to make me a very bitter, angry person.  I was miserable and tired of working on auto-pilot at home.  I realized that I had to forgive DH, and I also had to admit that I should have taken action long before I did.  We worked on our marriage and started “dating” each other.  I think falling in love the second time was even better than the first time.  He’s still not a dancer and he is still an extreme introvert, and I’m still not a baseball fanatic nor a fan of staying at home all the time, but we are good together and make a good team.  The odds of couples staying together during a bankruptcy is not very good, so I’m proud of us.

Our last bankruptcy payment was on August 28th and we were formally discharged from our Chapter 13 in November.  When I received my official notice (every single piece of correspondence was sent in duplicate; one to DH, and one to me), I cried as I read the letter.  The Trustee congratulated us on successfully completing our plan.  Of course, being the nerd that I am I had to research the percentage of successful Chapter 13 bankruptcies and I discovered the average is only 33%.  33%!!!! Yikes!!! We really were successful.  We saved our marriage and paid our debt.  I am still slowly catching up on my 401(k), I still cringe (even though I shouldn’t) whenever the phone rings and I don’t recognize the number, and I still cannot get a loan for the car of my dreams (although I was able to buy our son a "new" car), but things are going pretty good for us right now.

Although I have never hid the fact that we were going through financial hardship, I never asked for help from anyone or from any of the organizations my children were involved with.  I always paid whatever band, baseball, swim, soccer, scholastic fees we came across by scraping all of our funds together and going without lots of other "things".

Of course, this is a very condensed version of our bankruptcy story.  I would like to write something more in depth and detailed in the future.  I hope that in sharing our story, I can help at least one other person. For those who may be caught up in a financial nightmare, please know that  Bankruptcy is not an instantaneous end to your problems.  It is difficult, but if you are dedicated and committed to fixing your problems, bankruptcy can help you recover.  I would also suggest a couple of really, really good friends who will listen, offer their shoulder for good cries, and walk when you need to walk.  

*****If you live in WV and would like to seek legal counseling for bankruptcy, I highly suggest Aaron Amore (http://www.amorelaw.com/).   As an FYI - I was not compensated in any way whatsoever for recommending Mr. Amore. I wrote this because I wanted to share my own personal experience.