Michael Slowik of Bloomingdale stood without his lawyer before the bankruptcy judge and asked for extra time to gather his case and his wits before he loses his home amid mounting debt.
Slowik told the judge his lawyer had filed to withdraw from the case unexpectedly and left him alone to untangle the legalese involved with the bankruptcy filing. He even came armed with a check for $18,465, the full amount he believed he owed to stave off foreclosure.
But the attorney representing the mortgage firm refused it, saying the company wanted $26,000, an amount that soared when the mortgage company wanted to collect future taxes, Slowik said.
"I won't be forced to lose everything I've worked for," Slowik said outside the courtroom.
Slowik filed for bankruptcy with about $140,000 in debt in February, one of a record number of people who filed during the first half of this year, according to Washington, D.C.-based American Bankruptcy Institute.
Many are like Slowik, hoping to save their homes and reorganize their finances. Others just seek to walk away with the hope of a fresh start.
But doing so isn't easy. Changes in federal law since 2005 make filing bankruptcy more difficult. And the recession made it harder for people to go through bankruptcy and keep their homes, experts say.
Consumer bankruptcy filings nationwide increased 15 percent to 781,150 for the first six months of this year, compared to 681,217 during the same period in 2009, according to the bankruptcy institute.
Institute officials believe, based on the record number of filings so far, that the pace will reach about 1.6 million later this year.
Illinois especially the northern region saw bigger increases. In Illinois, total personal bankruptcy filings for the first half of this year rose 20 percent, to 41,603 from 34,738 for the same period last year, according to the institute.
In the northern district of Illinois, which includes Chicago and the suburbs, Chapter 7 filings soared 29 percent, while Chapter 13 filings jumped nearly 16 percent in the first half of this year, compared to the same period last year.
That's in spite of a federal bankruptcy law enacted in 2005 that increased fees, made it harder to file Chapter 7 bankruptcy, in which most debts are canceled, and added private student loans to the list of debts that can't be dismissed.
The U.S. Bankruptcy Court does not reveal the reasons behind someone's debt. But experts point to remnants of the recession, including high unemployment, credit card debt and foreclosure, as well as death of a spouse, a divorce or mounting medical bills. It often can be a combination of those factors, said American Bankruptcy Institute spokesman John Hartgen.
In the wake of the recession, going through bankruptcy while keeping your house has grown more difficult, said Jim Haller, board member of the National Association of Consumer Bankruptcy Attorneys and an attorney in downstate Bellville, Mount Vernon and Effingham.
In the past, when someone was laid off and fell behind in mortgage payments, but then returned to work, he or she often sought bankruptcy protection through Chapter 13 and would promise to make monthly payments.
"Now, there's a shift in debt and people just can't afford their house payment. They get these loan modifications, but they're just not successful," said Haller. "There's only a small percentage (of modifications) that actually work."
In Slowik's case, a troubling chain of events led to his bankruptcy. He went through a divorce and then went on medical disability for chronic articular gout, a painful condition that affects more than one part of the body. His debt mounted and he filed for bankruptcy.
Slowik said he hired a Schaumburg attorney, paid him $3,750 and asked him to straighten out his mortgage, which unexpectedly soared from $3,700 to $5,800 a month.
"They're just sandbagging my bankruptcy, trying to collect taxes for two years in advance. Does that make sense?" Slowik said.
But Slowik, a videographer, was then surprised to learn that his attorney filed to withdraw from the case, leaving him unprepared to face the task of representing himself in an unknown arena.
It's hard to think of the future, when the present is so daunting, but Slowik aimed to do the best he could.
The judge agreed to give Slowik a new court date, coming up on Friday, a chance to hire another lawyer and save what's left of the equity in his home. Slowik also had to straighten out his monthly mortgage payments.
In the meantime, Slowik received a $1,750 reimbursement from his former lawyer, less than half of what he paid. And the mortgage company has yet to respond to the court on Slowik's payments.
"I'm just trying to get this thing under control," he said.