Small Business Bust

I have read all the other stories on here about what precipitated filing for Bankruptcy.  I can relate, especially in the small business aspect.

I volunarily stopped working when I gave birth to a severely premature son.  Then I had twins, then I had another child.  It became too costly to provide childcare for all these kids.  My husband was still working and we were doing well.  The plan was for me to return to work when the kids were all in school.  I live in one of the worst states in the country for unemployment.  My youngest just finished 1st grade and I have been actively applying for work for two years - unsuccessfully.

We have owned and operated a small coffee business for 7 years which actually generates a good amount of cash.  But my husband retired from his job and it took 3 years, but everything  has come crashing down around me.  The business could barely support itself and his tiny pension couldn't provide for a family of 6.  His pension barely covered our house payment and one car payment.  Now our business has had to shoulder the burden of itself and our personal debts.  Our credit card debt alone is $80,000 and probably growing from interest as I cannot begin to touch these bills anymore.

I am like some of the others - always paid early, always paid double the minimum, etc.  So very conscientious about our credit.  The only priority I have maintained is our house payment - I have never fallen behind on our payments, nor our car payments.

I have made the huge decision to contact a private attorney.  My health is suffering.  I have anxiety attacks, I live on Xanax now.  I can't sleep.  I am developing an ulcer.  I have Rheumatoid Arthritis and this stress is causing it to flare up again.  I have to be here and healthy for my children.  They need me.

When those of you who have filed and completed the process - what do you mean that you lost "everything"?  I know it's a stupid question, but I haven't talked with anyone yet.  Will we lose our vehicles?  Our home - even though our payments are current?  What about our travel trailer, if we wish to continue making the payments on it?  I am very unclear about what "everything" is.

Any advise is warmly and gratefully accepted.  Thank you.

inapinch inapinch
41-45
1 Response Jun 19, 2008

I'm sure it's different state-to-state, but I contacted an attorney and he gave me a list of the things we're allowed to keep. Basically, they allow you only the bare minimum of any "extras". It's a monetary minimum (in auction price values, not replacement costs) in different categories such as: $30k in home equity (if you have more than that, they take your home); $1,200 in car equity (if you have more than that they take your car) $1,500 in personal property (jewelry, clothing, etc.) $1,200 in outdoor equipment (guns, bikes, hiking/climbing equip, etc.) So, for all practical purposes when they say "everything" they mean all the "fun" stuff that we tend to accumulate. If you own travel trailers, 4-wheelers, tractors, motorcycles or any other toys they will sell them to cover what they can of your debts. If your name is on any titles of other peoples vehicles, homes, notes, loans, etc. they are legally entitled to sell those to recover their money as well. I think finding the right attorney is of the utmost importance in this process. He/she should be the person guiding you through it and looking out for your best interests. If you get good information at the initial consultation go for it. If you leave with more questions than you came in with, look for someone else. It really is fairly cut and dried.