First thing, I would advise credit counseling. The one I went with was called GreenPath (www.greenpath.com), which a local TV business reporter recommended on his newscase; I hope there’s a GreenPath office near you. They advised me that bankruptcy was not as bad as I thought it was.
Like you, I had several maxed-out cards, and ended up filing a Chapter 7 myself (to be fair, this was in 2005, right before the new laws kicked in). Hopefully your case won’t be worse than a Chapter 13. In the end, all my debts were discharged, I never had to give up or sell my house, and to my surprise, the trustee never really considered liquidating what little I have in the way of assets. Yes, I ended up losing those credit cards, and I won’t be getting any new cards for a LONG time (C7 is the nuclear war of credit), but I learned to budget and spend my money more responsibly. And getting those bills off your back is a huge relief. Like you, I have also had to cut back on a lot of things to better make ends meet.
Above all, you do NOT want to end up like the Waleskowskis, a Waterford, MI family whose father, a cop, resorted to stealing money from a drunken driving suspect in order to help pay a tax bill. Prior to this, they had been rolling their credit bills into their mortgage several times over a number of years and this apparently caught up to them. I will not give more details because it is a tragic, sick, horrible story; for those who want all the details, I suggest you look up “Michael Waleskowski” on your favorite search engine.
I agree with this post about your situation. What else can you do as a family to even cut costs more. Part with cable or satellite TV? Settle for an older used car or just one car. This makes time management or setting up rides with others a challenge, but it may have to be done. Hey, there was a generation of Americans who survived with one vehicle -especially since most women were SAHMs- like you are. My mom stayed at home until I was 13 and she never drove until I was almost 17. Other women she knew, who worked or needed to run errands on certain days, would drive their husbands to work, so they could have the family car for certain days.
Think of as many other “things” you could do without. Remembering that it’s only temporary while you work on a plan to pay off those debts. I had a really hard time at first letting go of “things” I thought were needed for my lifestyle, but after I was clearing out my debt and finally got debt free, I realized that I never needed to spend as money as I did to live a happy and fulfilled life. Filing for bankruptcy could become the absolute last solution, so do very detailed research about it.
What kind of health problems prevent you from working even part-time or flex-time for a local business? Is there anything you can do to also solve this health problem to a point where you can work to help pay off some the bills?
Keep your eye on this site and get plenty of advice and suggestions from people who’ve been there. There is a site called DollarStretcher, that I get tons of money saving ideas from quite often and I’m not even in debt anymore. http://www.stretcher.com Check it out and sign up for their newsletter.