My family has alot of debt - mainly from some emergency medical expenses when my son was young, and our insurance dropped us due to his "risk factors" - thats another story though...

But anyways, we've slowly been paying it down (very slowly) always making the minimum payments or just a bit more then the minimum payments. Always on time, always making ends meet, though its been tough. I work seasonly and make very little money over the summer. We usually make up for this by saving as much as possible throughout the other months - this year some other expenses came up and completely wiped out our summer savings. I'm nearly 1000.00 behind on bills now and not even a month into the summer - and just see it getting worse. This is the first time in my life I have ever had a late fee on a bill and the first time I've ever had an NSF fee on my bank account. And it is stressing me out to the point of tears daily.

I've been trying to find a seasonal summer job - but with 3 children and not being able to afford childcare of any kind thats been difficult. When I return to work full time in September I know I'll have enough again to pay my bills - But don't know how I'll catch up with the late ones incurred over the summer.

My husband thinks we should declare bankruptucy, his reasoning is that the big debt we have isn't our fault and getting rid of it would be a brand new start. I don't like the idea because again having three kids - I did want to purchase a larger house in the future once we had the debt under control. (until this late situation came up we were looking at having it paid off in 4 more years).

Again, I've never been in a situation like this before, and I find it more stressing then anything I've ever encountered. If I do wait it out to the end of summer - what do i pay and what do I let go late or even later? I obviously don't want to lose my house or car, can't afford to have my phone or internet turned off because I use it to bring in the small amount of income I do make over the summer. Any suggestions or ideas of any kind would be greatly appreciated.... any been there/done that stories would be great to.

I used to work in collection law (mostly car repossessions and collection on car loans), but I'm not a expert, so take this advice with a grain of salt.

From my experience, it doesn't sound like you need to declare bankruptcy yet. You aren't too far behind on your bills (since you say this is the first time you've ever had a late fee), you've been paying faithfully for a long time, and you know when you'll be able to afford paying again (September).

I think your first step would be to contact all your creditors. Explain the situation, remind them you've paid on time for whatever number of months/years, tell them you'll be able to resume your full minimum payment in September, but that right now, the best you can afford is X amount.

Be proactive and persistent. You might need to talk to a couple of different people to get someone who will have the authority to bend the rules, but many of the creditors I used to work with were pretty willing to work with you if you've been a good customer in the past. They'd rather keep getting a lower, regular payment than have you stop paying at all, since if you just stop paying, it means costly legal action for them (remind them of that!).

Document EVERYTHING, especially if you come up with a revised payment plan until September. Get them to send you a letter detailing the revised plan. Just to cover your butt if things get lost in the shuffle, and in August they claim that you're behind.

If none of that works, or if I misunderstood and you've already done that, then you might need to start looking carefully at legal options. But first, I'd put all my effort into seeing if you can get them to work with you until the end of the summer, because you're right - bankruptcy is going to throw a wrench in your plans to buy a house.

Good luck. I'm really sorry you're going through this, I know it's incredibly stressful, and I wish you guys the best!!

Hugs....it's easy to say, "It's only money", but when you are struggling to handle it all and feel defeated, it can suck the joy right out of a sunny day.

I don't think bankruptcy is necessary. You've done a good job keeping it together for a while and since the accumulated bills are due to a medical situation (we had the same thing happen years ago and it was so depressing...)and not due to living beyond your means, there is an end in sight, even if it seems far off. Declaring bankruptcy is costly and it can haunt you forever. I'd save that option for hopeless cases.

Is it possible to re-structure your debt? Look at the total amount due on everything, come up with a number, and use that as your "need". You may find that by combining everything into one, you can reduce your monthly obligation and lower your interest payments, even if it extends the time on your obligations. Since you've been conscientious about being on time you may be able to refinance your home (interest rates are low now)or roll everything into a new single payment by transferring credit cards to a new account with an attractive "introductory" offer.

I wouldn't go crazy paying the medical bills. I don't know what the law is where you are, but here, as long as you make a payment of some kind, your credit rating can't be affected by medical bills. Just pay a small amount every month and work on getting rid of everything else.

Is it possible to baby sit for another child during the summer? It may provide several hundred dollars a month to your family, and since it is summer, it won't go on forever. The economy is so tough right now...I really feel for you. It is almost impossible to have kids of your own and work. There just isn't enough left over for child care.

Another option is to sell stuff. I know it sounds desperate, but you'd be surprised how much you can raise on e bay. I've been working on reducing the accumulated stuff in my life and it is unbelievable how much stuff we can do without when we put our minds to it. Last year we sold my car in June and didn't buy a replacement until Christmas. In that time alone, I saved $800. on insurance, another several hundred dollars on maintenance, and when I bought my new car it was $2,000. cheaper than it would have been six months earlier. We managed with just my husband's car and the savings was worth the occasional inconvenience... it just took more planning to make sure I had a car when I needed one.

You'd be surprised how many things of value you have hidden away that you never even think of. Old vinyl records? Collectors figurines, cake pans, books, toys....check out e bay and see what people are selling. You can actually make a few dollars on "Shipping and handling" if you're careful. Will you really miss that Hummell figure your aunt gave you for Christmas in 1978?

The final suggestion I have is a complete austerity budget for a few months. Cancel cable or satellite TV, get the bare bones phone plans, hang laundry on the clothes line to save the electric bill. With three kids your grocery bill must be large. It isn't "fun" but there are many ways to save on this one expense which can be extremely satisfying and may free up some cash for other things.

Make the public library a part of the "summer fun", plan picnics to parks, attend free concerts, and try to take your mind off your financial troubles while you enjoy your summer with your young family. They are only young once, and although money is rearing it's ugly head right now, you really will cherish the time you had with them years from now. Make the most of it if you can.

I wish you the very best. It is so hard to raise a family under the best of circumstances. I promise, this too shall pass.

Keep On Dancing*

Contact your member of congress's local office (not the DC office) and ask to speak with a caseworker. A lot of people don't realize that one of the main things congressional staffers do is help their constituents deal with personal problems such as this one and it's all free. Depending on the situation I don't know what they will be able to do for you, but they should have information and advice and also some pull with different agencies that might be able to help you out such as lowering your monthly payments or something like that.

I would have to agree with trying to tell things on EBAY or perhaps have a yard sell to get rid of old toys and baby clothes if possible.

I hope you are doing well- can you give us an update?

I am not in your shoes but feeling the crunch. Med bills are piling in and with very little $$$ it is so hard to even touch. I have been listening to Dave Ramsey and one day I hope to follow his FPU, but not now. Bankruptcy should be a very, very last resort. One you file you are basically screwed for 7 years. My friends had done this and it was very hard for them to buy their house and have good credit. Never ever call one of those consoildating places either- just scamming you. Refinancing is something you might want to do to?

Good luck and just think this is only temporary!

Po

Also - on John Tesh's website he has some legitimate ways to stay at home and work. You might wantto vist his website too.

One you file you are basically screwed for 7 years.

Not exactly. A bankruptcy wipes your credit, so you start over with a zero credt score. So things get alot harder, but if you smartly do your business, nothing is impossible. There are also credit card companies that expressly give cards to people that have been through bankruptcy, in order to help you better rebuild your credit.

contact all your cfreditors and explain the situation some are very good and will let you pay it back a small bit at a time.

Thanks to those you commented - things are still bad. Bad, very bad.
I contacted some people - best i could get was an interest rate reduction for 6 months if I was willing to set up automatic payments for a year. Which does me no good because they can't automatically deduct money that's not there.
With late payment fees piling up I'm in more debt then I'd even be able to save for next summer's expenses once I go back to work.

My youngest's first birthday is next weekend and my oldest wanted to go out last week and buy her a birthday present, I told her I didn't have the money right now and she offered her own birthday money to buy her sister a present. I told her she didn't have to do that and I'd have some before next weekend, I feel like the worst parent ever...

I am so sorry that you are going through all this.

I cannot offer you any help on your original question. However, money is very tight for us right now and here are a few things that I do in order to make everyday life a little bit easier.

I am in Belgium and we have this amazing website (www.foudeconcours.be/forum) where internet contests are listed and members share the correct answers as well and previously winning tiebreakers. Members also share "good deals": websites offering free products, discounts, coupons, etc. Maybe someone from the US will be able to tell you if there is something similar there.

1) Coupons:
I collect them from the internet mostly. Also, I try to mix my coupons with other deals (double coupons value days, reducted price, etc.)

2) Online contests:
- I enter those competitions for everyday products: deodorants, cleaning products, toothpaste, shampoos, ladies products, etc. My friends and family laugh at me but I haven't had to pay anything for these kind of products in the last 6 months.
- I also enter those contests in order to win "extras": tickets to fun parks, concerts, museums, trips (I have yet to win one of those) etc. We only go if it's free

3) Online surveys:
Websites (ex.us.toluna.com . . .) offer small payments for surveys. It can be a few euros or vouchers (amazon, etc.). I use those for birthday gifts.

This can all be quite time consuming (I'd say about 1h/ day) but it has made life a little bit better for us in the last months. I know it will not solve your problems at all but I hope it can bring a little bit of sun for your family.

Not exactly. A bankruptcy wipes your credit, so you start over with a zero credt score. So things get alot harder, but if you smartly do your business, nothing is impossible. There are also credit card companies that expressly give cards to people that have been through bankruptcy, in order to help you better rebuild your credit.

Actually it does ruin your credit for 7 - 10 years. You'll lose your credit cards. Yes there are some companies that give cards to people who went through bankruptcy, but the interest rates are insane, many of them have a high annual fee, and they start you out with $200 credit limit. You'll lose non-essential possessions and property, it will be very very difficult to obtain a mortgage (next to impossible in Phoenix), and it shows up on credit checks. I know people who have had problems renting houses or apartments in Phoenix. If you go buy a car the interest rates will also be insane...here in Phoenix they are 30% for people who file bankruptcy. The bankruptcy can be obtained via public record so any employer doing a background check will see it...so there is an embarrassment factor. In addition to all that, not all the debt may be discharged mortgage liens can be obtained after bankruptcy in some cases. Bankruptcy laws vary state to state. Bankruptcy is always the very very very last option. It will make life tough especially if you file bankruptcy together.

^ Completely agree.

We filed last year and it is awful. It is illegal for employers to discriminate based on credit rating but they do and a bankruptcy on that report can be a deal breaker for a job offer (even though it's illegal).

It drops your credit score to a 200, then you have to rebuild from there. To even be considered for a mortgage your score has to be 620 or higher. It takes long to build credit than to destroy it. I know some people have spoke of credit cards for people that have filed bankruptcy but I never found any. The attorney suggested it to rebuild our credit but I've been denied for any I've applied for.