Last week I had the pleasure of speaking to a former client about his experience before and after filing bankruptcy. I’ll refer to him as Andy in this discussion. Andy and his wife filed chapter 7 in 2011. Here’s part of our conversation.
Michael: I know I represented you back in 2011 but tell me again about what occurred before you considered bankruptcy.
Andy: At that time my wife and I had been married for 12 years and we had three kids. We both worked in the mortgage industry. Our problems started when I lost my job. At first we tried not to worry. We assumed I would get another job but as the months passed and our savings dwindled we got really scared.
Michael: What happened next?
Andy: We had never had serious money troubles. We took money out of retirement just to pay our monthly bills. Luckily our kids were young enough that they did not understand any of what was going on. I searched feverishly for a job, any job, but the economy was horrible and I wasn’t even getting interviews. Finally I found a job but the pay was straight commission and that didn’t work out.
Michael: Did you own a house?
Andy: We did. Our goal was to keep the house, no matter what. Unfortunately, my wife’s income was not enough to pay our living expenses and the mortgage got behind. We got foreclosure notices and we realized that unless I found a good job we would lose the house.
Michael: This must have been stressful.
Andy: Looking for a job is the toughest job. I spent so much time and nothing seemed to work.
Michael: Did this affect your marriage?
Andy: I have to say it was very harmful but I don’t want to go into detail about that.
Michael: You mentioned drawing money from retirement, did anything else happen with your finances?
Andy: Uh…yeah. We had all kinds of debts we were not able to pay. We had to focus on food and shelter. We had creditors calling, we owed IRS, that whole situation was super stressful.
Michael: Tell me about bankruptcy.
Andy: We realized we would need to file bankruptcy but we held off. For one thing, we didn’t have the money to file plus we didn’t want to file. We kept putting it off. We knew we needed to file because we just owed too much money but we were scared of the consequences.
Michael: Eventually you filed chapter 7 in 2011, right?
Andy: That’s right. We made payments on the attorney fee and eventually got it paid off so we could file. Filing was a turning point for us. The collectors stopped calling and we were able to get some of our old taxes wiped out.
Michael: Can you tell me what has happened since the bankruptcy?
Andy: The main thing is I found a good job. We did lose the house but we were able to find a house to rent nearby so our kids did not need to change schools. I wasn’t sure a landlord would rent to us but he did.
Michael: That was five years ago now.
Andy: Right, and we have been able to get back on our feet. You told me I could have good credit two years after filing chapter 7 but I didn’t really believe it. Turns out you were right. Today all that seems like so long ago but it also seems like yesterday. Definitely made me appreciate my family and the things I have.
Michael: Looking back, how do you feel about the decision to file bankruptcy?
Andy: Like I said, we really didn’t have a choice. That said, it was a life-saver.
Michael: Thanks for talking to me today. Stories like yours are what makes my job worthwhile.