Bob from Arizona

“…the forgiveness and realignment process of bankruptcy was the smartest course we could have taken…”

When asked by my friend Lawrence to write our story of bankruptcy, I had to think back of a time nearly 20 years ago. My story is accurate but the specific dates may not be.

After attending seminary for 7 years and acquiring another Master’s degree in Massachusetts, my wife, our grandson, and I moved to Arizona. Winters became too much for my wife and my mother convinced us to move close to where she lived. We made the move, rented an apartment for 6 months, then moved to a house rental about 4 miles from my mother. This was in 1992/93. September of 93 we drove to Atlanta, Georgia for the birth of a granddaughter. Some years later her father became unemployed as did our daughter. This occurred in the same time period my father-in-law was dumped by his girl friend in Florida. And here is where the financial downhill slide began.

Moving to Arizona, my wife’s income as a nurse was reduced by half and I was promised a teaching position at a local high school that did not materialize ( they hired from within and did not notify me until the school year began). I started my own painting business thanks to a $1,500 loan from my step-father and played by all the rules. My employees were paid a fair wage and I covered their Social Security. I incorporated the business and had an accountant to give guidance. All went well for five and a half years; paid back the loan, acquired enough to purchase a house and accepted a full time teaching position.

The financial crunch of 2007/2008 hit and it was this period of time when our unexpected expenses exacerbated. I flew out to Florida, rented a truck to move my father-in-law and his dog to Arizona. We met my daughter, son-in-law, and granddaughter along I-10 at the Florida panhandle and lead them all to Chandler Arizona. Upon arriving at our home some three days later we moved everyone into our house. Having covered everyone’s expenses until my son-in-law got a job and moved out; we supported “daddy” and moved him to an independent living apartment supplementing his Social Security. Teaching at a Christian school and my wife making what for us was half pay and having used up all of our savings taking care of family members we were strapped financially. Naturally, this is when the air conditioner sprung a leak, unbeknownst to me until water started dripping through the guest bedroom ceiling onto my grandson’s bed. We had him enrolled in a Christian grade school as well as our granddaughter. Our swimming pool had to be resurfaced, and our van needed tires and some expensive repairs. Credit cards were our only options to cover these added expenses and by Christmas time my accountant said we needed to file bankruptcy so as to save our house and rebuild. My $30,000 student loan did not go away, nor many of our other debts, but we filed. There was only one gift for our grandson that Christmas and it was the first time in my life a care package was left on our doorstep because of our financial plight. I felt I had failed so badly as a husband and family provider.

Never had I thought I would suffer so, financially, having been raised to do it all without help or complaint. After 6 years teaching at a Christian school, I took a far better paying position at a public school in Phoenix.  Having taken the accountant’s advice and going through the 7 year recuperation process, we came out of the bankruptcy stigma and are now these many years later wiser and financially sound.

We did learn, though, that the forgiveness and realignment process of bankruptcy was the smartest course we could have taken to re-establish our credit and financial footing. I was not a failure as a husband or provider, I had simply fallen victim to some poor financial decisions, while trying to do too much with too little cash and too much credit debt. The bankruptcy stigma was much more in my head than in reality; it provided our best option to rectify our financial position in order to rebuild.

Bob, Arizona

Editor’s note:  Bob and his wife generously took care of many members of their extended family which greatly added to their expenses.  The credit card and banking industries encouraged and enticed Bob to use his credit cards for the unexpected expenses which hit like a flood.  More frequent use of bankruptcy, like used by Bob and his wife, would reign back the reckless enticement of the credit card industry. 

 Also of significance, Bob’s student loan debt was not allowed to be dismissed by our current bankruptcy laws.  The shielding from bankruptcy of student loan debt by the Federal Government is one of the factors that have under-gird the double digit growth of college tuition.  This blog believes that full discharge of student loan debt should be allowed in bankruptcy.  The loss on each default should be passed on to the sponsoring college.