'I Was Lying on the Bathroom Floor, in the Fetal Position, $2M in Debt'

On March 9, 2009, the electricity company came to cut the power off in my apartment in Louisiana. When the lights went out, I ran outside, with my one-year-old daughter on my hip, to see what had happened. I went down the pathway to where the meters were, and I saw the power man. He was cutting off a lot of people's power—that was the nature of the neighborhood my partner and I lived in.

I walked up to him and asked if he could turn the power back on, as my baby's milk was going to spoil. He took pity on me and said, "I can act like I missed it, but they will be back." When I walked back to my apartment, the power was back on.

But that was the moment where I thought: I went to college, I graduated, I tried to be a good person. Why was this my life? My partner came and took our baby on a walk, and I ended up lying on the bathroom floor, in the fetal position. It was 2009, during the recession, and my partner and I were $2 million in debt.

Life before the financial crash

I started a real estate and mortgage brokerage at the age of 22, straight out of college. By the time I was 25, it was worth $1 million.

I'm from south central Los Angeles, not from the best neighborhood, and I felt like I had won the lottery—that I had reached the pinnacle of success. I was living good, I was eating good. My then-partner, who co-owned the business, and I drove matching Range Rovers. I thought I was living the life.

In 2007, I was 26 and we were in our second year of doing very well. Our company was on track to making seven figures again. But then I took a fall down the stairs, while I was 20 weeks pregnant, which sent me into preterm labor. And that was the beginning of the unraveling.

How my business fell apart

My daughter was born 10 weeks' premature, but she was healthy. She stayed in the ICU for another four weeks, while I was on hospital bed rest for 10 weeks.

While I was in hospital, the financial crash was just starting. Banks were closing down; my loan officers and real estate agents' deals were falling apart.

Our business used to create six-figures a month but, going into my second month in the hospital, it dropped to around $20,000. We had an expensive office in Manhattan Beach, California, we had employees and my then-fiancé and I owned 13 pieces of property. My partner was exhausting our personal savings to keep everything afloat.

Within six months of me leaving the hospital, I had to lay everyone off at our company. I couldn't keep it afloat. And then about a year after all of this began, I found myself in foreclosure.

A devastating medical bill

While I was in hospital, my medical insurance company had been sending me mail. I had no clue, as my fiancé hadn't brought it to the hospital. When I finally went home, I went through the mounds of letters. I opened insurance statements but I couldn't understand what they were saying until the hospital sent me a final bill, telling me how much I owed. And that's when I lost my breath.

My insurance dropped me when I was in the hospital as I had apparently exhausted pregnancy coverage within a 12-month period; my son had died prematurely almost a year to the day that my daughter was born. I didn't realize but, because I got pregnant again pretty quickly, I had exhausted whatever pregnancy issues they were willing to cover. So all that debt fell to me, and there was over $300,000 medical debt in my name.

I felt like my life was ending. I could not possibly see, with no money coming in, how I was ever supposed to get out of this. I was so used to paying a bill whenever I got it, so I felt a sense of hopelessness and helplessness. I had never seen a bill like that in my life, and it was devastating. Who do you ask for help? Where do you turn?

The hospital was sending notices all the time. It was overwhelming, to the point where, for almost a year, I avoided opening mail. Then I got a statement that mentioned something about a payment plan, and a number to call if I needed help. So, in 2008, I called the hospital and broke down on the phone to a kind woman, who told me I should write a hardship letter.

I poured my heart out in the two-page letter, explaining my circumstances, and the hospital ended up forgiving over $200,000. I didn't even know hospitals had hardship funds to help people in need. After, I was left with about $80,000 medical debt.

Facing eviction notices

By then, we had foreclosed on our home in Southern California and our cars had been repossessed. We moved to a town called Metairie, Louisiana, in 2008, where we lived in a 600 sq feet, not-great apartment in a sketchy area. But the landlords were willing to lend to people who had credit issues and, by then, my credit had tanked, so it was the only thing we could do.

We got eviction notices every month because we never paid on the 1st. If we paid by the 10th it was a miracle. I was doing odd jobs in a real estate office, but the pay was low and erratic.

My partner and I applied for jobs but everywhere we went, people were like, "Oh, you're overqualified." I came out of college and started a business so I didn't have traditional work experience in the way that people wanted. We were also at the height of a recession, so people were not hiring at the time.

I applied for welfare, I was getting food stamps—which saved our lives—and we had a voucher so my daughter could go to daycare a couple days a week.

My partner ended up driving down a street and stopping at every fast food place and applying for jobs. At Taco Bell he told a woman who worked there, "I will literally mop the floors. I just need health insurance for my family." And my partner worked at Taco Bell for 18 months, originally mopping the floor until he was promoted to work at the drive-thru.

I once saw someone throw an open face taco at my partner's face through the drive-thru window because they were upset about their order. This is a man who used to wear a custom, tailored suit and drive a Range Rover. I felt humiliated for him, and for us as a family.

Keeping our situation a secret

When my partner got that job in Taco Bell, we misrepresented what it was to our friends and family. We told them he was in a training program for management.

I had been so proud of everything we had built and it crumbled so quickly that I didn't know how to tell people. I felt so much shame, guilt and embarrassment about being in debt.

I was used to people asking me for help, and I didn't feel like my friends and family could handle the weight of what I was experiencing. During this period, one of my really good friends from college called me, freaking out about a $10,000 debt. How do I say, "Girl, I'm in $200,000 debt?" I was so used to being a safe space for everyone else that I didn't consider the fact that I didn't have a safe space.

I didn't know it at the time but I had postpartum depression. It ended up getting diagnosed after the fact. It was beyond hard. I felt an extreme amount of guilt for bringing a baby into the world in that s***-storm. I felt like such a disappointment.

I had this fairytale idea of what kind of mom I'd be, and how loving and present I would be for her. But I was so depressed some days that she would cry and I would just look at her and cry back. I didn't have the capacity to soothe her.

I didn't sleep at night, as the debt used to keep me up. It just got bigger and bigger. I had other properties that had been foreclosed by 2009. When my partner and I bought our real estate before the crash, we didn't put down large down payments—I was putting down 5 or 10 percent, never 20 percent. So when the market tanked, most of those properties went under. We couldn't sell them, and if we sold them, we had to short-sell, and then we owed the bank the difference. Between the medical debt, the cars that were repossessed, and the real estate, my partner and I were in nearly $2 million debt.

On March 9, 2009, while I was on my bathroom floor, I realized things needed to change. I started to tell people the truth, starting with my brother, who I called that day. Being honest with my brother was the first step.

A month or so later, my brother offered for me to go to Atlanta, Georgia, and watch his kids for a week. I ended up staying on his couch for six months, with my child, until my then-husband joined me and we rented an apartment.

Rebuilding my life

I'm a Christian and, because of my faith, I felt it was wrong to file for bankruptcy. I thought I should just continue to pray about it, and stay on top of my payment plans. I thought I was being a noble person and doing the right thing but I realize now the emotional, physical and mental toll that took on me for quite some time.

I was under a payment plan for anything and everything under the sun. But I was not making a dent in my debt. The payment plan was to show good faith, but let's say I'm paying $50 a month but the interest is adding $87 a month, I'm not getting anywhere. It was just no way to live. As my mentor told me, "You can't nickel and dime your way out of millions of dollars of debt."

I got sick and tired of being sick and tired. I don't remember a pivotal moment, I just remember thinking, "I can't live like this. This is never going to change." So in 2012, I filed for bankruptcy.

It mentally freed me to move forward. I was a volunteer at a financial education nonprofit here in Atlanta and they hired me full-time, around the same time I filed for bankruptcy. I think, energetically, there was a lot that I needed to release; I wasn't fully able to serve people, knowing that this was all lingering in the background.

I always thought that telling people my experience would be the death of any dream to help people in personal finance, but it was the catalyst. It's been the thing that continues to endear people to me, because I know what it's like. I'm not talking about it as a person who's like, "Oh I went to college and everything's been perfect, and you just need to do better." I'm talking about it as a person who had to dig herself out of years of payment plans and then find the resources to move on with her life.

Now, I am beyond comfortable. I'm fully restored. Maybe not everyone wants to be a seven-figure earner, but everyone wants to sleep at night. I just want people to have more peace, and not be tossing and turning because their personal finances are overwhelming. I know what that's like, but now I can say I sleep peacefully.

Patrice Washington is a coach on the new financial advice show, Opportunity Knock$. She is also the host of the Redefining Wealth podcast.

All views expressed in this article are the author's own.

As told to Newsweek's My Turn deputy editor, Katie Russell.