[Free America52]

To everyone, thanks for your comments and thoughts. I am 56, have risen from nothing to comfortable middle class and now it is disappearing before my eyes. And I have other friends who are also in similar situations. Whoever thought we would see this type of environment in our lifetime?

[Eric in the Ozarks]

I’ve been there.

[firebasecody]

Note to OP: If you go Chpt. 13, retirement savings does not count as ‘assets’. They are protected.

[no-to-illegals]

I too am sorry this situation has befallen you and yours. There is Great advice (imho) on your thread. May God hold you and yours in His Hands. Tough times come and go. God will carry those who go to Him. It will still be tough, though God cares. Good Luck FRiend. Will be in prayer for you and yours.

[kenavi]

In 3 1/2 years (age 59 1/2), you won't have to pay the 10% penalty on withdrawal of 401K savings.

If your only serious debt is your mortgage, you shouldn't have to seek bankruptcy protection.

You are wise to consider, now, going through a short sale or deed in lieu with your mortgagee bank. If you no longer need a house the size you own, why keep paying for it.

Restructuring your lifestyle is not in lieu of looking for a new job, it gives you peace of mind which allows you to concentrate on moving on.

Congratulations on getting your child her education. It will serve her well in life, as well as your example of bearing up through thick and thin.

[narses]

1 - At 56 you have 3 or so years to go before you can get past the 10% standard penalty on qualified plan / 401K / IRA distributions.
2 - You just suffered a major blow, like a death.
3 - Do NOT make big decisions right now.
4 - Take a job, even at $10 an hour. Get work, call center, security guard, anything.
5 - Do a very careful assessment of your expenses and income sources. If you can, cut. If you cannot, ask yourself why?
6 - Analyze your balance sheet. What do you own, what do you owe. Hire a CPA with a CFP to do a two or three hour analysis and advise you. Worth every penny.
7 - Be open with friends and family that you are looking for work. Join Facebook and LinkedIn. Ask for help from your Church.
8 - At age 62, if the program still exists consider using a FHA Reverse Mortgage to replace your current structure.