Bankruptcy and Divorce

In 2009, my parents separated, filed for bankruptcy and divorce.  These events have greatly shaped my adult life and years later, still cause a lot of anger and pain.  The path to these events were a long time coming, but they really took root in 2005.

At the time, Pete and I were in college in Boston.  My parents were still together and living at my childhood home.  We moved to this home in 1994 – for those of you counting at home, we had lived there for more than 10 years.  In the years leading up to 2005, mom has consistently voiced her displeasure with the house.

What was my mother displeased about?  Well – you have to understand mom.  She is a woman who constantly seeks change for the sake of change.  In some ways, I admire her.  She knows or appears to know what she wants and goes after it.  If she is dissatisfied, then she will seek a change.  However, sometimes, I think her need for change was borderline pathological.

For example, when I was a kid, on occasion, I would come home to find that mom re-arranged my room.  She explained that it was better this way even when I protested that I liked my room the way it was.  I know this sounds like small potatoes.  There are mothers and fathers that beat, neglect and generally abuse their children.  But as a kid, it still felt like a violation of my autonomy.

Eventually, she wore dad down and they decided to put the house up for sale.  It was on the market for a few months when a family with two adorable girls fell in love with our house and made an offer on the house.  My parents accepted the offer and continued their hunt for a house.  The buyers for our house also need to sell their home.   In a strange twist, the realtor suggested that my parents go to see the buyers’ house.  We looked at their house and my parents decided to make an offer.  We essentially exchanged houses!

Flash forward to the end of 2007.  As most of you know, the economy completely tanked.  I graduated college from college in December of 2007 without a job and horribly depressed.  I did what many of my generation had to do.  I moved back in with my parents.

In January of 2008, mom and dad confessed that they were exploring the possibility of filing for bankruptcy.  I knew that money was an issue, but I did not know that it was bankruptcy bad.

The point is – the purchase of the new house was a horrible financial mistake and was the point where my parents finances unraveled. Home prices were sky high as the houses sold near the height of the housing bubble.  I did some research.  My parents sold their home for $343,000.00.  They bought the new house for $353,000.00!  What were they thinking!?  In hindsight, I can’t wrap my head around this.  One of the reasons my parents wanted to move was because they wanted to DOWNSIZE!  Pete and I were in college, and at the time, neither of us were expecting that we would move back home. I also researched the bankruptcy records.  Their consumer debt (unsecured debt like credit cards) were over $100,000.00.

As the winter months came and went, the situation went from bad to worse.  Mom was in denial.  Despite their intention to file bankruptcy, she bought 3 iPods and a 32 inch LCD TV on credit.  The bankruptcy attorney also advised dad to buy a new car – because once they file, he might not be able to buy one for quite a few years.

In May of 2008, Pete graduated and moved home.  He was able to find a job, but he needed a car.  Mom and dad bullied him into taking a fairly bad car loan for a used car.  To this day, I’m still angry about that – but I selfishly already had a car and Pete needed one.  In another bad financial move, dad purchased a car for me in 2003 and I co-signed the loan.  I went along with it – what did I know?  I was 18 and excited to get a new car!  But then I went away to college and dad kept paying for it.  When 2008 rolled around, I had use of a car that we owned free and clear.  Pete was not so lucky.

It was around this time that my student loan deferments had run out and my parents were no longer going to assist me in paying my loans.  I was so angry.  My parents gave me vague promises in college that they would help out with my student loans.  I was in despair – I had a part time job, but I wasn’t making much money.  How would I ever afford payments of $400 to $500 a month?  How would I ever pay off $80,000?  My anger was explosive.  I threw my parents mistakes back in their faces and we constantly fought.

I also discovered more disturbing news.  Dad had taken out various credit cards in my name.  To my recollection, they were mostly gas credit cards.  Most of them only had limits of $1,000 or less.  However – the worst was the Macy’s card.  I had a store card with Macy’s.  I signed up to get a discount on a purchase and I paid it off.  No big deal.  In addition to the store credit card, there was a separate line of credit for purchases made outside of Macy’s.  Dad somehow applied for this outside credit or just started using the card without my permission.  He racked up $10,000 of debt.  To this day, I’ve never received an answer as to what he used this for. He also maxed out one of my personal credit cards with Capital One to $1,000.  I hadn’t used the card in years and again, I didn’t know he had access to it.  I felt my life spinning out of control.  I called up many of these credit card companies and cancelled the cards.  Dad was super pissed and angry with me, but I yelled right back.

Pete was not spared either.  He had one credit card.  I’m unsure if Dad maxed this out or not, but I do remember that Dad would often raid Pete’s bank account for money.  Again, I’m unsure how much money he stole from him.  It could be anywhere from a couple of thousand to 5 figures.

Near the end of the summer, my parents told Pete and I that they were planning to move out of the house because they could not afford it.  They started to look for apartments.  Pete was planning to move out and I was planning to stay with them because I did not believe I had the money to afford an apartment.  But, it became clear that that living with them would not be an option.  My parents found a house to rent and Pete and I moved in with a friend to his apartment in October of 2008.  The house went into foreclosure.

Times were rough.  I was making some money, but not nearly enough.  I was working two jobs that just barely covered my living expenses and the minimum payments on my credit cards.

A few days before Christmas in 2008, Pete dropped a bomb on me.  Mom told him that she was leaving dad on the first week of January.  I was disgusted that she told Pete and she asked him to tell me the same.  Pete and I had to go through Christmas and the next week like nothing was wrong because mom would not tell dad.  It was awful and it was the worst secret I’ve ever had to keep.  I’m unsure if Pete or I should have told him – I can see the argument going both ways.

Mom followed through on her plan.  She already secured a place of her own.  On D-Day, she drained some portion of the bank account, packed a suitcase and left.  Dad called me and was furious.  He demanded if I knew anything about this.  I lied.  Pete lied too.  A week or so after she left, she asked Pete and I to help her move stuff from their rented house to her new apartment.  The confrontation at their house is one of the worst hours of my life.  Dad could barely control himself.  He was yelling and swearing.  He broke some things.  He declared that mom was entitled to nothing.  In the end, mom took the items that she wanted anyway.

After the separation, the bankruptcy rolled along – very slowly.  Now that their finances were separate, they were able to convert their Chapter 13 bankruptcy (a formal repayment plan to creditors) to a Chapter 7 bankruptcy (complete liquidation – all debt is wiped clean.  They made these terrible financial mistakes and their slate was wiped clean.

Pete and I – not so lucky.  As much as I complain about my student loan debt, Pete’s was worse.  Mine reach a high of approximately $80,000.  Pete’s student loan debt was around $120,000!

In the years that followed, I was able to make a little more money.  I knocked out some of my own personal credit card debt, forced my parents to pay off that Macy’s card as penance and start attacking my student loans.

It’s now 2015.  Somedays, I feel like I’m over this, but other days, it still makes me so angry and depressed.  Pete and I have delayed starting a family.  We’re unable to buy homes. I don’t have the resources to go back to school to start a new career.  Pete works 60 hours a week and more to make his payments. Basically, we’re indentured servants until these loans are off our backs.

My relationship with both mom and dad have improved.  Mom chipped in to help out with some expenses from time to time.  Dad, not so much.  He’ll occasionally go overboard at Christmas and Birthdays to make up for the guilt he feels.

It’s hard not to blame them.  Ultimately, I’m responsible for my own life.

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~ by southclaw on February 28, 2015.

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