Oh GOSH!! ISP problems. I am gonna delete most of them! Sorry!

My heart goes out to you! I think I would exhaust every possible resource before filing for bankruptcy, though.

I agree w/pp, sell everything you can get your hands on. Ebay & Craigslist will get you more money than a garage sale, but a combination of the all might work.

Prioritize your debt, house & car first (if you can live without one, do), b/c you need a place to live and a car to get to work, or you can't get money, and you won't have a place to live. Vicious cycle!

As for unsecured debt, call creditors & see if you can claim hardship & negotiate lower interest rates, lower payments, anything at all will help. Especially with so many people defaulting, they seem to be willing to work with people a who honestly want to pay.

Also, swing by the library and check out the book Good Debt, Bad Debt. Ignore the part about real estate deals, and look at the debt management part. We were in a situation that sounds rather similar to yours, and were able to climb up from the edge & pay off $28,000.00 in debt in about 3 years by using the methods in this book.

Also, although it might not be ideal, you could take a job with hours opposite your husband's just to get through this rough spot. That way you could still homeschool, and it might just be enough to pull your family's financial life back from the edge.

We called some credit counseling places and they suggested bankruptcy too (seek legal advice), but we are not doing it. We plan on paying off our debt.

On paper, it doesn't work, but we are doing it. We've been making payments on time and if we keep this up, we will make it. My income will gradually go up and our expenses will gradually go down.

Bankruptcy is just one of many options for you. You could also just default without paying your bills and if they try to sue you, you can fight it in court probably because they probably don't have the original agreement that you signed. Or, you can settle with them.

Bill collectors are almost all bark and very little bite. They will harass you but are probably bluffing about their ability to actually force you to pay through the court system. There are many protections for consumers if you know what you are doing.

But, even though our credit card debt is higher than our annual income, we have decided to pay it off. I got a second job on the weekends delivering pizzas. We lowered our expenses. Got on some hardship programs with credit card companies to lower the percentage rates. Delayed student loans. I'm taking payments out of my IRA in substantially equal payments for my life span so I don't get hit with any penalties for early withdrawals.

I am looking for a higher paying job.

I suggest increasing income and decreasing expenses right now. Get a part-time job. Share the homeschooling with another homeschool mom so you can work part-time. Cut out any extras- no extra insurance- raise the deductibles or just get rid of it.

Look at how the Amish live without electricity, without cars, without phones. Look at how the Mexicans live with a bunch of people in one house. A whole carful of people when they travel. You don't have to live like everyone else. Everyone else is in debt too. Live the best way- not the ordinary way.

And it's not depriving your children to live frugally. It is in their best interest for you to get your finances under control. It doesn't harm them. Eat beans and rice. Stop driving. Sell your car and live with only one car. Share your home with another family. Move out and live in a trailer. Or move in with relatives.

Even if you go the bankruptcy route, you need to get your finances under control, or it will happen again. People who go through bankruptcy hate it and don't recommend it, so we are trying to avoid it.

Best wishes to you. It's a stressful time, but you will get through it.

from what i understand, it's MUCH harder to file bankruptcy now than one year ago. rules have changed and it's not as easy as it used to be. also, i like the previous poster's advice:

""I suggest increasing income and decreasing expenses right now. Get a part-time job. Share the homeschooling with another homeschool mom so you can work part-time. Cut out any extras- no extra insurance- raise the deductibles or just get rid of it. ""

plus, selling everything you can on Craigslist.
plus, do you have a mortgage? If so, call the lender and make an appt to see him/her. (dont' deal over the phone). When in person, tell them your situation. .They "might" consider giving you an "interest only" loan for a while....BELIEVE ME, BANKS DON'T WANT YOUR HOUSE BACK....they have enough houses in foreclosure.

when we refinanced our farm (several years ago), our lender told us that "if" we ever got into a jam, we could ask for an interest-only loan for a time period...we've never done that, but it's in the realm of possibility these days....

Strawberry,

PLEASE e-mail me... aoakes@comcast dot net. I will tell you everything we experienced.

Aime

you can email me as well, if you need to. we had to go that route, unfortunately but i can let you know what i know if you need me to.

thmtwdec99@hotmail.com

Try to see if there is the nonprofit consumer credit counseling in your area - there should be no fee.
Also, you need to have a plan even if you do file to protect yourself in the future. There are a lot of good resources out there. Mary Hunt, Crown Financial Ministry, etc.
Also - credit card rules change in February with a lot more restrictions on the companies which is why they are all jacking up their rates.
Praying for you - I know this is hard.
Hugs

mamaof3peas-I'll email you tomorrow also :)