Over the past few years, my husband and I have had several financial setbacks. First, he had a severe heart attack which left him unable to return to full time work. Because we were very proud, and I had a good job, we chose not to file for disability for him. Then, I lost my job…. Because of his health, I signed up for Cobra, thinking I’d only be out of work for a few months at most. The monthly payments were 0 more than my unemployment benefits! What little savings we had were eaten up, and then I started charging the Cobra payments. With the credit cards maxed, I was forced to give up Cobra. To top it all off, our ARM skyrocketed last year, and we ended up losing the house. Thankfully, we were able to do a short sale, so we at least didn’t have to foreclose. I am working again, but have no benefits. He suffered Congestive Heart Failure this spring, and now is receiving disability pay. We get our medical services through a community clinic, but make too much to qualify for free services, and of course his lab work is sent to the local hospital which offers no discount. So, we have approximately ,000 in unsecured debt, with a combined income of about ,000. About 15K is credit card, and the rest is medical. We get conflicting advice on how to get out of this mess – bankruptcy or credit counseling?

Technorati Tags: bankruptcy, cobra, congestive heart failure, credit card, credit cards, credit counseling, disability, financial setbacks, full time work, good job, health, heart attack, heart failure, local hospital, medical services, unemployment benefits, unsecured debt

I mean besides worrying that if the company you work for goes bankrupt there goes your health insurance and the COBRA extension; Also, wouldn’t it be amazing if you could work the job you *want* rather than the one that offers the best benefits. Why do we still have this system as it limits self employment, small business growth and creates "job lock"? Ever tried buying insurance independently outside of an office pool with two pre-existing conditions? Even if you cut back on absolutely everything, it’s still unaffordable.

Technorati Tags: business growth, buying insurance, cobra, health insurance, insurance, job, office pool, pre existing conditions, self employment, small business

After trying to find ways to be able to take care of our responsibilities we have come to the last resort and that is to file bankruptcy. We don’t own any homes or any real property. what I am curious about is which is better chapter 7 or chapter 13. We want to be able to start saving a soon as it done and when feesible start rebuilding credit. Our credit card debt is only 00 which is a lot, but it could be worse. We just had two bad years with this one being the worse. I am looking for advice on the best way to go between the two. Chapter 7 or Chapter 13 and why.

We are not happy about doing this as we have tried everything. We don’t have anything of value and we have tried to pawn stuff but couldn’t get .00 for most. We live very modestly. So please do not answer this question if you are going to be negative.

Thank you so much. We want to do the right thing so we can start over and never have to do this again.
Thank you so much for all that has given advice so far. I guess I need to add just a few details to make the situation clearer.

As I stated it has been a bad 2 years, actually almost 3 years. I got real sick and had to leave my job and am now on disability. My husband took on a second job a year ago. He pays child support. Between the two of us we have 5 kids between the ages of 9-16. We have two vehicles, which one is in the shop. We also are surrendering this vehicle.
We have an attorney and he is recommending chapter 13. I (we) have a lot of medical bills. After I had to leave my job I couldn’t afford the cobra payments for continued health insurance. To maintain health insurance with my husbands employment (state worker) would have cost more than the cobra payments.
My ex- husband filed bankruptcy and I did not know that anything he had when we were together, came back to me.
I never thought I would get sick and have to quit work. I was not prepared.

Technorati Tags: 3 years, bankruptcy, chapter 13, chapter 7, child support, cobra, credit card debt, disability, do the right thing, employment state, health insurance, insurance, last resort, medical bills, pawn, rebuilding credit, second job, state worker