bankruptcy advice...file or not? 7 or 13?

[triple7]

I'm in OHIO

My situation is as follows:

My wife and I have been separated and will eventually divorce, we do get along fine. She owns a biz that has failed and thus she has to file for Ch.7. due to the debts the biz has incurred.

Since we've been separated, I've lived in the house for which I've kept up on all its, and my payments and bills. My credit is literally spotless. I've been working 2 jobs to keep my head above water.

The problem lies in that I co-signed on the biz loans. Her and I are signed on a $21K unsecured loan. Her and I and her father are co-signed on a $77k secured loan. With her filing Ch.7, the banks will be coming after me for the balance on the co-signed loans. Her attorney has advised that I also file Ch.7. so that I can get out from under the 21K unsecured loan that I cant afford to pay at the moment. The plan is to have her father pay on the loans he's co-signed on and my wife will find a job and pay her father back.

My house was put up as collateral for the secured loan. We initially fell behind on payments due to the original bank being bought by an out-of-state bank and them consequently "losing" our loan as we couldn't get a hold of our banker. They've since told us to pay them the owed interest, which we plan to do this week, then they'd talk with us. There is no equity in the house.

My other debts total roughly 11-12k and are basically unsecured credit cards.

So my questions are.... do I have any other options other than bankruptcy? and...if bankruptcy, which chapter and can I lose the house??

It seems a shame that I would have to file even though my credit is very good.

any help is appreciated!

 

[bigun]

You're the only one who knows what other options you have other than bk.We have no idea about your income or, any assets that could be sold to pay off/down the secured loan.

As to bk-the lein the secured loan has will survive a Chapter 7 filing.
If, the value of the home is below the amount owed on the first mortgage then, you can strip that junior lein in a Chapter 13.
I'd realistically look at, is the home worth keeping and, can you comfortably afford the payments.
Most bk lawyers give a free or low cost initial consultation. Speak with a few and see what they suggest.

 

[triple7]

The house is appraised at 120K, I owe 113K on it. I've been doing fine on the payments as the mortgage, insurance and taxes take up about 40% of my take home pay. I dont have any other major payments other than the unsecured credit cards. Everything else is utilities and the like. I've been working pretty hard to pay down everything I owed. I would be more than willing to pay on the co-signed loan but with my cc debt right now, I just cant afford to.

As for assets that can be sold, I dont really have anything of real value except my vehicle and I can arrange to keep that in bk. I dont collect anything, no 2nd home or 2nd car or flat screen HD tv's or anything I can think of that is really worth something.

I've spoken with 2 lawyers and they've suggested piggy-backing on my wife's Ch.7. I'm just having a hard time swallowing the fact that I have to file for bk just because I signed on the dotted line, even though my credit is great.

 

[JustAPal00]

If the father in law is going to take care of the 77K loan, that gets the house off the hook and leaves you with only the credit cards and the 21k loan. If you can pay them off, you can avoid BK. If not, you might as well file and include them. Since the father in law is getting the house off the hook, there's no reason you can't keep it if you want. Chap 7 or 13 depends on your financial situation and your ability to pay it back.