Dear Steve,
I got divorced in 2007 . I had a full time job, owned a house, car and never missed a payment on any bill, including my student loans.
After my divorce and the loss of a dual income with debt that needed that dual income( car, student loans, credit cards, medical bills,etc.), I moved from Connecticut to Maine, wanting to find a less expensive living situation, and a fresh start.
I have since struggled to find a high paying job that I'm qualified for. I had a full time job as a coffee shop manager and i couldn't afford to stay in my apartment. For two years now , i have been living an hour outside of Portland with a friend for free so i can get back on my feet. I voluntarily repossessed my car as it had more problems to fix than i could afford.
My student loans have been in default for two years. I owe over $60,000, and i am being sued by the National Collegiate Trust. I had looked into bankruptcy over a year ago and to my dismay, it seems you need pretty hefty savings in hand to even go through that process.
The lawyer i had spoken to wanted $1400. Are there any bankruptcy lawyers that work through funding sources that can help people like myself try to get ahead and get over this awful point in my life?
Thanks,
Gretchen
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Dear Gretchen,
First off, thank you so much for reaching out to me for help through Huffington Post.
The situation you have experienced is one I often see after divorce. You astutely identified that the reduction in the dual income and the loss of shared expenses has resulted in an unsupportable situation. I guess I could have summarized that by just saying sometimes divorce really sucks.
Divorce is charged with so many emotions. From the "I've escaped" to "I've been abandoned" feelings there is almost no room available for a cool logical evaluation of the financial situation.
What I find most ironic in divorce is people turn to the court to use the law to remedy their marital situation but the hesitate to turn to the court to remedy the resulting financial hell hole.
If you were looking for free help to file bankruptcy in Maine you could try the Maine Volunteer Lawyers Project and see if they can help.
If they can't help then try my bankruptcy directory and if there is nobody in there close we'll try to find someone that can help.
On the student loan front I really think my guide on how to handle problem student loans could really help. You can read that here.
This research I did on student loans in bankruptcy, including some with National Collegiate Trust showed some of the loans were modified or fully discharged in a bankruptcy adversary proceeding.
Also, I think this research on federal student loan lawsuits will give you some indication that dealing with the lawsuit is a better outcome than not.
Ultimately this is not a debt problem. The debt is the symptom. The reality is this is an income problem. I think if you can deal with the debt to reduce the mental strain it will give you a better chance to get back on your feet and have success in getting back to a sustainable income level.
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