Thinking of filing bankruptcy

Avatar for nmillerhhi
iVillage Member
Registered: 03-25-2003
Thinking of filing bankruptcy
6
Tue, 02-22-2011 - 11:28pm

I am 60 and my husband is 62. I have never filed bankruptcy in my life. We were doing well but then I became disabled. My disability check is $1289/month. My husband is working and almost all of our assets are in his name. The only thing in my name is our camper which is paid off and my husband uses it when he travels for work rather than stay in a motel. I have one small credit card with a $500 limit. I've been trying to go to school but health problems have caused me to drop the course I'm taking 3 times now so I have student loans. My debts are all medical for copays. I owe one surgeon alone $4500 for copays for surgery. The mortgage is in my husband's name and he has 2 small credit cards. We owe one vehicle payment. Both vehicles are in his name.

My husband's youngest child was 19 last month and we had received notice that we didn't have to pay child support any longer. We had a court order saying he had to pay $100/month on arrearages, which we have been paying for 10 years. However, the interest rate is so high that the balance on the arrearages has continued to rise. Now the interest owed is more than the arrearages. So, he has received notice that he will have to pay $665/month until it is paid off. The problem is that with a high interest rate and frequent compounding, it will be years before it's paid off. We contacted a lawyer and he said we had to pay it but when my husband retires, he could get the monthly payment lowered but that means even more years of paying. The child support enforcement agency in that state will not allow him to talk to his case manager, only a call center, and will not provide an APR or estimated number of payments so we have no idea how long we're looking at.The arrearages are $16,000. The interest due on that is $17,000.

in addition, his ex was a tax preparer. She always handled all their tax returns because he travels for work. We found out that the last 3 years they were married, she filed separately, claiming all the deductions and leaving him with all the income. We are still paying $150/month to the IRS on that debt.

This means that his debts related to his previous marriage are $805/month. Our mortgage including taxes and insurance is $785. The car payment is $450. Credit cards are $100 or more when I can. Then, we have the usual insurances - car, household goods, and life. We can't get anything but accidental death on me. He has $50,000 death benefits. We also have utilities.

My medical bills are killing us though. We had anticipated being done with the child support which would have reduced our outgo by $555/month. We intended to use that to pay off my medical bills. Last year, I had two major surgeries, a two month stay in the hospital, and I have 8 different doctors.

We have stopped buying birthday and Christmas presents. We no longer eat breakfast. My husband takes two peanut butter sandwiches for lunch and I have a bowl of ramen noodles. I'm running out of ways to make potatoes for dinner since that is our primary food. I would not have started back to school had I known that we would be paying his ex forever.

The only think I can think of is to file bankruptcy to take away my medical bills. My husband had planned on retiring at 62 which is normal in his line of work because the work is so physically taxing. He can't now. He had a retirement account but cashed it in and gave it to his ex when they separated. He says he tried to tell the judge about it but the judge refused to hear about it and she denied receiving it. The penalties for the early withdrawal are part of the IRS payments we're making.

I'm just not sure what to do to help us. My health has become too fragile to work. Last week, my husband found me unconscious and without a pulse. Paramedics got my heart beating again but I was in a coma for three days. One leg was amputated last Sept and the other may need amputation if a bypass doesn't get the blood flowing correctly.

iVillage Member
Registered: 11-18-2008
Fri, 02-25-2011 - 5:36pm

nmillerhhi, I'm so sorry to hear about the rough times that your family is facing.

Have you spoken with a bankruptcy attorney yet? I think it would be a good first step in determining what would be covered by filing bankruptcy.

Please don't go without eating! Contact your local social services office about applying for food stamps, call local food banks, churches and other organizations. If you don't eat, you can't get better, right?

Please keep us posted. I hope that things improve for you.

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Community Leader
Registered: 03-17-2003
Fri, 02-25-2011 - 6:19pm

Hi nmillerhhi,

It sounds like you have a fairly good grasp on your household financial profile and what you could gain by filing personal bankruptcy.

Avatar for nmillerhhi
iVillage Member
Registered: 03-25-2003
Fri, 03-11-2011 - 12:12am
We called a lawyer in the state where the child support enforcement agency is. He said he could not help us. We have to pay what they say. However, when DH retires, he will be able to help us get the monthly payment lowered. This would extend the debt for more years however.

I thought about bankruptcy. I used to work for a bankruptcy lawyer. The debts that would be available for bankruptcy are medical expenses. I am still seeing those doctors so I don't want to endanger my relationship with them by filing bankruptcy. They are being good about accepting token amounts each month.

We checked on food stamps and other sources of food. We don't qualify. Even when my DH was unemployed last year, his unemployment was $100/month over the limit so we couldn't get help.

This week, my DH only worked 4 hours because they didn't have work for him. He shows up daily but got sent home. That means next week's check will be meager. Groceries this week consisted primarily of peanut butter, beans, rice, eggs and ramen noodles. We had a great coupon for dog food and my parrot eats what we eat except he also gets 3 florets of frozen broccoli a day and a slice of apple. I had $25 to spend on groceries. A couple of weeks ago, I didn't have that much so I guess we're doing ok.

What really hurts us are the medicines I need. Since writing my original post, I have been in the hospital again. DH found me unconscious and without a pulse. Epi injections in the ambulance kept me alive until the hospital could resuscitate me. I was in a coma for a couple of days. A few days ago, we went to fill new and refill prescriptions on me. It wasn't all I take. The copays were $238. I had to choose not to fill a couple of things that I considered non-essential. We didn't have that much money.

This is so hard for me. Until April 2009, I made $80,000/year. Now I only have SSDI.

I had been going to school trying to get a doctorate. Tonight, I sent an email to my adviser dropping out of school. I didn't want to do it and DH certainly didn't want me to. However, I'm 60. I was going for my own personal benefit rather than a career move. We won't be able to afford the arrearages plus student loan debt plus living and medical expenses once my DH retires. If I knew that the arrearages would be paid off, I would have done it. I had to look at it as a want, not a need. DH was really depressed about it. He hates when his past garbage interferes with my life. I had started because I thought we would only be paying the $100/month court ordered payment.

Yes, I'm anemic and know I need to eat better. But I do what I have to do. I try to make sure that DH gets protein and other nutrition because he is a construction worker and needs the energy.

Community Leader
Registered: 03-17-2003
Fri, 03-11-2011 - 11:07am

I'm so sorry you are going through this.

Community Leader
Registered: 07-26-1999
Mon, 03-14-2011 - 12:02pm
Have you looked into the hardship programs through the individual drug companies? I know many of them have programs for people who are having trouble paying for medications, but really need them. It may be a bit of hassle and paperwork at the beginning, but it may be something to look into to save you money over the long term.

As for food, there are organizations like the Angel Food Ministries that may be able to help you stretch your food dollars a bit more www.angelfoodministries.com and local churches that help.
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iVillage Member
Registered: 10-31-2002
Sun, 04-03-2011 - 10:23am

It seems you have a handle on the finances but bankruptcy laws have changed recently. Now when folks file bankruptcy they had to have a spending plan/budget to show and most judges are telling folks ditch the credit cards. Bankruptcy remains on the credit report for a long time. The goals is that folks are file bankruptcy don't show back up in court to file again.

First, food shelves, please visit those, they are there in the community to help folks and volunteer if