Congress Pointing Some Fingers at the Creditors

[anonymuse]

http://blog.startfreshtoday.com/

[jane taylor]

Interesting! Our attorney says that the trustees and judges are really mad because they had no input into the new BK law and that they are actually siding more with debtors as much as they can get away with. Our trustee prefers people to submit 0% to unsecured creditors plans. Ours is a 0% and was confirmed three weeks ago with no problem.

Looks like greed just might come back to bite them in the behind after all!

jane

[anonymuse]

It seems (to me, from my limitted perspective), it was Congress and creditors providing the input for the new bill. They really needed to involve more trustees and judges and BK attorneys. And one group that would have really "told you like it is" would be people that had filed--believe it or not, we do get PO'd at that < 5% or whatever that actually are out there to abuse and defraud the system. We'd like to get the public (including Congress and creditors) to have a "reality check", and the people filing probably could have contributed the most to BK reform.

[jane taylor]

I agree!! I think that they should have included some of us! I never in my wildest of dreams could have imagined ending up here! I know what I could have done differently, but there was no way to prevent so many surgeries and job losses due to funding. I know there are people who abuse the system and it is insulting to lump us in that category!

[BassBoy]

Interesting reading Anonymuse. I have to agree with the blame being partially on the lenders that extend credit without taking steps to ensure that consumers are capable of repaying the resulting debt. IMO, I feel this is more of the sub-prime lenders that are the root of this. From my past experience, sub-prime lenders will loan to almost anyone. Hmmm, I often wondered if they did this with a motive in mind......knowing that the debtor couldn't repay the loan, but looked at it as a way of taking the debtor for all that they had.

Just my opinions.

[robivi3]

THANK YOU, I've said this for ages. Creditors, especially today have some culpability in this!

[anonymuse]

Believe me, I will never be the one that blames the creditor for the mess I got myself into; however, when they're going overboard and making it impossible to set up a realistic repayment plan, they do share a percentage of the blame.

Luckily, I've never been caught up in the "let's see how many credit cards I can own" game. But there's plenty that do and carry them around like a badge of honor--the thicker the wallet the better.

I'm just so glad I put myself on the "opt-out" list--so sick of getting those credit offers.

People have got to remember: if it looks too good to be true, then it probably isn't.

[aa06a47]

Yes, I cannot blame the credit card companies for my situation, but never the less, they still encouraged it. When MBNA talked to me prior to filing BK, they asked me what my income was, I told them, and they said, we only like our clients to have credit card limits of no more than 30% of there income. The ironic part of that is that when I got my MBNA credit card, I made roughtly 1/2 of what I do today. In fact, the limit they provided me on the day I filed was equal to 1 years 2006 salary.

So, since I was a bad credit risk, they increased my interest to 28%, put all my limits down to when they add the interest in each month, it gets them an over charge fee and of course closed my accounts.

I had a Citi account that was 1 or 2 days late.....wow, it is a 3.9% for life rate that went to 30.9%. Then all my other citi cards did the same thing.

I am thankful they did that though, it made me realize how stupid I was and made the decision to file bk for me.

[anonymuse]

I am thankful they did that though, it made me realize how stupid I was and made the decision to file bk for me.

Don't call yourself stupid! We all make unwise decisions at some time or another in our lives. While the decision may have been "stupid", you are not "stupid".

[FoolAndHisMoney]

Don't call yourself stupid! We all make unwise decisions at some time or another in our lives. While the decision may have been "stupid", you are not "stupid".

It's actually not easy feeling this way. I knew just using these cards were stupid and I did it anyway. It's one thing to make a mistake not knowing and learning from it, but it's another to do something that's knowlingly stupid and that's why I do feel like a fool, hence the name.

What still surprises me about the new laws (and I keep mentioning) is how generous it is to secured creditors allowing debtors to load up on new cars or second homes which I thought was the kind of abuse it was trying to stop. The mean, means test allows this which is really bad news for the unsecureds. One of the links posted weeks back stated that a chapter 13 trustee can't even make a debtor give up their summer home and pay more unsecured creditors. I think congress was trying to save the housing and car markets with this new law.

[anonymuse]

FOMO, just remember not to judge your whole being or character by your financial dealings--there's a lot more to your character than your FICO score.

I know Discover and Chase have offerred me great home equity loans. That's actually a smart move for them since they know they can turn your unsecured debt into secured debt and get something if you fail to pay.

[aa06a47]

FOMO, I know what you mean. Heck, had I spent another 231/month on a lease vehical, I would be chapter 7 instead of chapter 13. My lease payment is 450 which includes insurance, it would have been really easy to get a 680 car payment with not much effort. I didn't think of that when I got the vehical, I wasn't planning BK though at the time.

Anon, it is hard to not think of myself as stupid....but I appreciate the support. God gave me alot and I was not a good stuart of what he gave me. That is all changing now. I guess I just had to hit rock bottom before I knew I was falling.

[lrprn]

It's actually not easy feeling this way. I knew just using these cards were stupid and I did it anyway. It's one thing to make a mistake not knowing and learning from it, but it's another to do something that's knowlingly stupid and that's why I do feel like a fool, hence the name.

What still surprises me about the new laws (and I keep mentioning) is how generous it is to secured creditors allowing debtors to load up on new cars or second homes which I thought was the kind of abuse it was trying to stop. The mean, means test allows this which is really bad news for the unsecureds. One of the links posted weeks back stated that a chapter 13 trustee can't even make a debtor give up their summer home and pay more unsecured creditors. I think congress was trying to save the housing and car markets with this new law.

There are some pundits on the net who say the written-by-creditors-for-creditors new bk laws last October achieved the well-hidden agenda of helping those rich folks who have more expensive 'toys' ensure they keep all of their physical secured assets during bankruptcy (a rich Congress helping their rich supporters). We'll never know for sure but it wouldn't surprise me one bit....

[anonymuse]

There are some pundits on the net who say the written-by-creditors-for-creditors new bk laws last October achieved the well-hidden agenda of helping those rich folks who have more expensive 'toys' ensure they keep all of their physical secured assets during bankruptcy (a rich Congress helping their rich supporters). We'll never know for sure but it wouldn't surprise me one bit....

The means test didn't do what it was supposed. I think they should have scrutinized people that had more than 2 times the median income, or something like that to basically say, you need to change your lifestyle a bit and payback something in a Ch 13.

[FoolAndHisMoney]

There are some pundits on the net who say the written-by-creditors-for-creditors new bk laws last October achieved the well-hidden agenda of helping those rich folks who have more expensive 'toys' ensure they keep all of their physical secured assets during bankruptcy (a rich Congress helping their rich supporters). We'll never know for sure but it wouldn't surprise me one bit....

It didn't actually do much harm for the poor either since below median income debtors can file chapter 7 without the test. The attorney fees probably hurt going up, but that's about it. It does hit the middle class very hard. I try to stay positive and encourage others to do the same, but when I read the chapter 13 section of the forum I can't help but be upset for most of you. 5 years is a long time to have to give up all extra money and not have an emergency fund in place. What I don't like about the disposable income test under old and new laws is that if you're poor and get a chapter 7 discharge, you can rebuild your financial life in about 2 years by earning more, saving more, and do very well by 5 years from your bankruptcy. If you are sentenced to chapter 13 debtors prison with no non exempt assets just because you have a couple of hundred bucks left over at the end of the month you are stuck even poorer then the poor person that qualified for the 7. Not a good thing IMO.