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do you think it''s too easy for people to file bankruptcy?...

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Dancing Fire

Dancing Fire

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i mean anybody can screw the credit card companies & retail stores and get away with it ,there''s not much they can do about it.
 
Yes I think bankruptcy is a Godsend for those in genuine need of it, but not as a free ticket for those who have overspent due to their own selfishness and refusal to face the consequences of their actions. It is very unfair on those who have to foot the bill and those people who live within their means, work hard, pay their bills and go without.
 
I believe that the laws have recently changed DF, to make it harder to be absolved...
 
MMM is correct, although the new requirements largely don''t go into effect until October. There was a substantial amount of controversy over the balance struck by those provisions between the benefits of a fresh start and the prevention of abuse.
 
It is possible to live a responsible life yet get laid off, lose health insurance, get sick, go broke, etc.

However I think this does NOT describe the majority of bankruptcies.
Most are people who, like most Americans, are spoiled brats who abuse credit to live WAY beyond their means.
Then they don't have the ethics to live up to their financial responsibility by getting a job or two, shopping at the thrift store and lowering their standard of living down to there is should have been all along while they pay off their debts, with fair interest.

So yes, I think bankruptcy is too easy of a way out.
I say throw the bums in jail.
Stealing is a crime.

End of rant.
 
Date: 8/12/2005 10:36:23 AM
Author: Lorelei
Yes I think bankruptcy is a Godsend for those in genuine need of it, but not as a free ticket for those who have overspent due to their own selfishness and refusal to face the consequences of their actions. It is very unfair on those who have to foot the bill and those people who live within their means, work hard, pay their bills and go without.
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Lorelei
i agree 1000%.
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Date: 8/12/2005 2:06:53 PM
Author: kenny
It is possible to live a responsible life yet get laid off, lose health insurance, get sick, go broke, etc.


However I think this does NOT describe the majority of bankruptcies.

Most are people who, like most Americans, are spoiled brats who abuse credit to live WAY beyond their means.

Then they don''t have the ethics to live up to their financial responsibility by getting a job or two, shopping at the thrift store and lowering their standard of living down to there is should have been all along while they pay off their debts, with fair interest.


So yes, I think bankruptcy is too easy of a way out.

I say throw the bums in jail.

Stealing is a crime.


End of rant.
Click to expand...


I hope U never fall on hard times!
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LM
Read my post again.

The first sentence is about people who DO fall on hard times through no fault of their own.
For them I think forgiveness or reduction of *some* debts is okay.
But there should be criteria.
If it is clear they are bozos, then no debts should be forgiven.

Also I wrote that I think the innocent ones are the minority of bankrupcies.

I know people at all income levels who live both well within, and well beyond. their means.
I have no sympathy for people who make crappy choices in life.
Crappy choices = crappy life.

Also it brings to mind the bumpersticker, "The harder I work, the luckier I get."
 
Our friends are engaged to be married next month. He filed b/k begining of last year and she has always struggled with money (low paying job, juggling bills, etc.) and his credit score is only about 50pts lower than hers. He''s around 540 and she''s low low 600s.

You''d think there would be a bigger penalty.
 
the problem I see is that too many folks who don''t need it use it as a way out of their carelessness and those who truly do need it aren''t able to get the help they need because of those who abuse it.
 
Date: 8/12/2005 10:37:43 AM
Author: moremoremore
I believe that the laws have recently changed DF, to make it harder to be absolved...
Click to expand...
i know but,still too easy?
 
What about Donald Trump???
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Believe me, he''s not the only rich person or corporation
to use bankruptcy as a business move.
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I think in many cases bankruptcy is the symptom of the credit disease of today. Yes, there are those unavoidable, no fault of their own situations, but the majority of Americans have no savings and buy on credit expecting to be able to pay for it later. So it is no wonder that many of them end up in bankruptcy when the windfall never materializes.

Like somebody''s grandma said, if you don''t have the money in the bank, you don''t buy it. Simple as that. The only exceptions should be life and death emergencies, not very strong desires or non-essentials we feel entitled to. You hear people saying, "But we need two cars," or "I have to have a cell phone for emergencies." Think back 50 years. The world never stopped spinning because rides to and fro work had to be figured out or somebody didn''t have a mobile phone.
 
For corporations it depends on the type of bankruptcy. Most file reorganization which is not a "get out of debt free" card. They still have to pay their bills. I have heard of people (no one I know, just through friends) who get into too much debt, file bankruptcy and start over. It's not the way to live. Makes it nearly impossible to get an affordable mortgage and can prevent you from getting a job. I'm in a job where not paying your bills will lose you your job because of security issues.

Edited to add: Most people who get into credit card trouble do it buying lots of odds and ends, stuff they don't need. It's not from a car payment or two, it's from the designer purses, shoes, clothes, etc that run up a credit card to the limit which will increase your limit. It's still the individuals' responsibility, but somewhere they missed the "class" on being an adult.
 
I''ve only done about 3 very simple chapter 7s at work.
First one was a lady in her 40s, living at her parent''s home, no kids, 50 grand of cc debt, No intention of working more than 5 hours a week.

Second one was the amazing guy who went into heart failure. Lost his job and insurance. Lost everything. A tree even fell on his 1980 van on his way to my office once. He felt horrible about having to file.

Third one was an uneducated woman in her 50s. Her husband went to jail for stabbing her. She had a lot of debt but was working full time.

It''s interesting to see the different circumstances.
 
Date: 8/12/2005 9:59:33 PM
Author: lmurden
What about Donald Trump???
11.gif

Believe me, he's not the only rich person or corporation
to use bankruptcy as a business move.
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i'm talking about personal BK.i can use my CC to buy myself a 4ct diamond and then tell my CC companies to go take a hike.there isn't much they can do about it but, how can i live with myself ?
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after screwing the CC co's for a 100k.

if Donald Trump did file for personal BK at one time then he should pay back his creditors,if he has the money now.
 
I think declaring bankrupcy is like driving a gas-guzzling, air-polluting SUV. Both are legal and are justified in some cases. Both are abused by people who don''t need it. Both are taking from a public good because the credit card companies are so large and have so many investors that it''s like taking some fresh air or increasing the price of gasoline an infintesimal amount. No one particular person is significantly hurt if you default on your credit card debts, and no one particular person is hurt because you waste more gas or pollute the air more. Finally, both have some penalties, higher gas costs or worse credit ratings.
 

I first heard of filing personal bankruptcy when a coworker of mine shared that she was going to do it, and yes, to get out of paying her highly overly spent credit card bills. They had no regard for their own credit since they got everything they could possibly want/need at that point, vowed to pay cash for everything for the next 7 years and also vowed to start all over when that time had lapsed.


and that was my first lesson in personal bankruptcy.
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Yes, I do think it''s too easy for cases like these. I am not talking about the legimate cases.

MMM, wow.
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That must be eye-opening.

OT but a story to share...
Years ago, I used to work at a grocery store. We serviced all kinds. Many were immigrants receiving federal assistance via food stamps. I never quite got the cases of those receiving assistance, coming to purchase food in bulk with their coupons, then turning it around to supply their lunch wagon right across the street.
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Or those spending dollar upon loose dollar, breaking the coupons down to smaller bills if necessary, only to use the cash change to turn around and purchase cigarettes and alcohol. What''s wrong with this picture??

but I digress...

 
Moremoremore, did the amazing guy lose his job because of his health problems? What a catch 22 . .

I have a 28 year old friend with stage 4 colon cancer, and as far I can tell, there is no hope, although the doctors have said some vaguely optimistic things (but from what I''ve read, the only chance of long-term survival at this stage is it hasn''t spread to the lymph nodes and if the liver tumor can be removed via operation, and they''re only doing chemo on him, and he has four tumors in various places). Anyway, he is a teacher, and he is worried about what will happen if he can''t work this year. I guess he can continue on his insurance through the cobra. I know paying bills will be hard if he isn''t even getting disability, but I suppose that is really the least of his concerns.
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Kudos to everyone.
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This thread is doing a great job of capturing the debate that raged in Congress earlier this year over the recent amendments to the Bankruptcy Code noted by MMM. It''s a very difficult balancing act to provide relief to the truly needy (BTY, bankruptcy was recognized as a public good by the founding fathers and is authorized in the Constitution), yet prevent or at least limit the potential for abuse. It will be some time before we know whether the new law improved or undermined that balance with respect to personal bankruptcies (Chapter 13), which seem to be the principal issue here. As noted by some, business bankruptcies present a whole different set of issues.
 
it seems like the 7 years of bad reporting on the credit report seems like it would deter people, but maybe not if people 'plan' to pay cash.. however, you have to wonder, well if you couldn't pay cash for the 20k of purchased items you have on your cc's then why would you be able to pay cash for everything for the next SEVEN YEARS to get around it?

i was a typical stupid college student and racked up cc debt in college and it took me years to pay it off. my credit was not stellar...and only in the last few years has it really started to be awesome again after YEARS of rebuilding. there are two very small bills that i never paid off (macys and some other dept store) from years ago, which were like $100 and $300 respectively. i always wanted to pay them, but was always afraid that it would reflect negatively on the credit report after i had started rebuilding, and couldn't find definitive answers to the contrary so i just left them as is. they fell off last year i think. but i still feel like i want to call up and pay them.

having had bad credit for so long and then finally now having great credit, it's so important to me to keep it that way! i don't think i'd feel as strongly if i'd always had good credit, for me it's like a badge that i worked past stupidity. and bankruptcy can be an easy way out for people who do abuse credit just out of ignorance and then think that they want to start over.
 
Date: 8/12/2005 2:06:53 PM
Author: kenny
It is possible to live a responsible life yet get laid off, lose health insurance, get sick, go broke, etc.

However I think this does NOT describe the majority of bankruptcies.
Most are people who, like most Americans, are spoiled brats who abuse credit to live WAY beyond their means.
Then they don't have the ethics to live up to their financial responsibility by getting a job or two, shopping at the thrift store and lowering their standard of living down to there is should have been all along while they pay off their debts, with fair interest.

So yes, I think bankruptcy is too easy of a way out.
I say throw the bums in jail.
Stealing is a crime.

End of rant.
Click to expand...
I tend to agree as below is a personal experience that presents exactly the senerio you decribe.

I can only attest to one relative who clearly lived ENTIRELY beyond their means. First, they tried to borrow from relatives (couldn't get a bank to give them anymore money) - and I'm talking "borrowing" well into the 5 figures. When the relative lender wouldn't "loan" anymore money, they filed personal bankruptcy. Fast forward about 10 years later, the exact same thing happened. Prior to this, they asked us to co-sign a loan ON OUR CREDIT. Go figure why we refused. ANOTHER bankrupcy - defaulting on all loans.

And, I completely understand that people fall on hard times when it becomes an unfortunate necessity. But, I can assure you in the instance above, no medical issues, no loss of job issues - pure unalterated irresponsible spending and savings issues. BTW, to date, NONE of the "borrowed" money has been repaid. What the heck are they going to do when they need to retire?

Oh - and DF is gonna love this one - when they didn't have the money to buy something (and no one would let them "borrow" from them) they took the equity out of their house. Yes, they lost the house to forclosure - but the equity was already spent. What did they have to loose?
 
"Personal bankruptcy filings are steadily rising. The total number of cases filed increases each year, and more telling, the percentage of working men and women who file, are both accelerating rapidly. Only Chapter 11 business filings have decreased in recent years. On average, American families carry more debt today than at any time in United States history. With good jobs in short supply, this unprecedented financial strain upon middle America is causing widespread concern among economists and creditors according to Alan Greenspan, Chairman of the Federal Reserve Board. The profile of the average debtor who files personal bankruptcy has changed. Wealthy individuals seldom file. The poorest segment of our population seldom files with the US Bankruptcy Courts. The typical debtor in personal bankruptcy is an average income earner who either: 1) lost employment, 2) recently contested divorce, or 3) suffered debilitating injuries or illnesses. Of all people filing personal bankruptcy, 80% fit into at least one of these categories."

see: http://www.personal-bankruptcy-chapters-7-13-filing-laws.com/

yes, we can all telll a story of a credit abuser, but those that keep a tally of such things indicate such a credit abuser is in the minority.

additionally, credit card companies extend credit to high risk individuals, target young college kids without much experience, send out unsolicited approval notices for cards and/or credit increases, etc. in other words, credit card companies contribute to the problem.

i cannot recall ever having a class that taught living within one''s means, budgeting, etc. perhaps as a part of graduating from high school there should be a mandatory class regarding these types of things. if the goal of education is to prepare young people for the real world, then we are failing miserably in the area of financial responsibility.

peace, movie zombie

ps corporations use bankruptcy as a business strategy. i find this more appalling and immoral than an individual who files for bankruptcy. i also object that my tax dollars are then used to either prop the corporation up and/or to meet the corporations obligations regarding retirement, health benefits, etc.
 
I know several people who have gotten themselves into severe c/card debt and they continue to do so. I know there are some who use it because they have to because of medical bills, lost jobs, tough times, etc... I feel for those people and can toally understand why they''re charging their groceries and gas. I''m talking about people who feel they are entitled to a certain level of living, whether they make enough money to live that way or not. I am somewhat frugal by nature and it burns me when I see these people spending excessively, although I know down the road they will face consequences, either by filing or by having a crappy credit score. If someone can afford it, that''s fine, but if someone can''t and ends up filing bankruptcy later that''s not right because we all pay for it by higher interest rates. By the way, if someone did file and had charged an engagement ring, would they take the ring back? Just curious.
 
Date: 8/13/2005 4:35:31 PM
Author: fire&ice

Date: 8/12/2005 2:06:53 PM
Author: kenny
It is possible to live a responsible life yet get laid off, lose health insurance, get sick, go broke, etc.

However I think this does NOT describe the majority of bankruptcies.
Most are people who, like most Americans, are spoiled brats who abuse credit to live WAY beyond their means.
Then they don''t have the ethics to live up to their financial responsibility by getting a job or two, shopping at the thrift store and lowering their standard of living down to there is should have been all along while they pay off their debts, with fair interest.

So yes, I think bankruptcy is too easy of a way out.
I say throw the bums in jail.
Stealing is a crime.

End of rant.
Click to expand...
Oh - and DF is gonna love this one - when they didn''t have the money to buy something (and no one would let them ''borrow'' from them) they took the equity out of their house. Yes, they lost the house to forclosure - but the equity was already spent. What did they have to loose?
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self-respect,pride.
 
Date: 8/13/2005 5:01:42 PM
Author: movie zombie

additionally, credit card companies extend credit to high risk individuals, target young college kids without much experience, send out unsolicited approval notices for cards and/or credit increases, etc. in other words, credit card companies contribute to the problem.
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that''s a lame excuse. if someone offers me drug,i''m still not going to use it.
 
I guess the cc companies walk a fine line between wanting people who are going to wrack up huge debt and pay exorbitant interest and not wanting people who will not pay at all.

I knew someone who worked at Capital One who spoke proudly of their efforts in the customer service department. "We want them to appreciate doing business with us, and we want our bill to be the first one to pay. If they can only pay one bill, we want it to be ours." What a rosy picture of their average customer . . . someone who has to choose what bills to pay due to a lack of funds. And you know that is bull. They want you to be a little late paying, so they can tack late fees and interest on. They just don''t want you to never pay.

I never had a credit card in college -- paid for my car and everything else in cash. I realized when I graduated that this was held against me for my credit score purposes. I received a Capital One offer in the mail and filled it out, and they sent me back this letter saying that because of my lack of credit, I had been rejected, but was approved for some alternate card with a ridiculously high APR and a $500 limit. That was certainly more responsible than National City, who instantly sent me a card with a low (for then) APR and a $5k limit, but why did they send me the offer if they were just going to reject me?
 
Date: 8/13/2005 7:22:19 PM
Author: Dancing Fire

Date: 8/13/2005 5:01:42 PM
Author: movie zombie

additionally, credit card companies extend credit to high risk individuals, target young college kids without much experience, send out unsolicited approval notices for cards and/or credit increases, etc. in other words, credit card companies contribute to the problem.
Click to expand...
that''s a lame excuse. if someone offers me drug,i''m still not going to use it.
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Precisely. And for the record, my example did not have any credit card debt. It was choosing to buy this and that over paying the mortgage bill, electric bill, etc.

Clearly - self respect and pride did not supercede spending beyond their means. Or, recognizing it as such. It''s just sooooooooooo foreign to me. Or maybe the outward things gave them the self respect and pride they so despretely needed. You, nor I, are never going to relate to that situation - but it does (spending to keep up with the jones''s) give some people respect and pride.
 
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