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Bankruptcy and Vehicle Financing

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Comments

  • KCRamKCRam Mt. Arlington NJPosts: 3,516
    Tthird and last warning from myself and Car Man

    Regardless of which side of this debate you are on, the personal comments/attacks will cease NOW. A few of you are very close to serious penalties, understood?

    kcram
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  • fezofezo Manahawkin, NJPosts: 10,376
    Now I don't know the excat details here and don't know what state you are in (you actually have at least one CPA trying to gove you advice and perhaps a lwayer as well - I'm neither of them) but I can tell you that when I was a kid my dad ran up HUGE debt due to the fact that his older brother snuck out a bundle of cash under his name (never mind the details) and for years we lived with that. Yes, mom had the house in her name and we lived off mom's earnings for quite some time while dad slowly paid off every cent. The strain on mom and the marriage was tremendous and had she not been an amazingly strong woman and dad stuck with the program I have little doubt that it would have killed the marriage. Living with that kind of tension ain't pretty.

    I'm not saying that this will be what happens to you. I'm saying be very careful because what you don't know can kill you.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • mney6mney6 Posts: 116
    All I can say is that I have alot of people who take their lawyers and their friends advice that it is no big deal to BK.
    Yet, when they come in to purchase a new car and I have to secure financing for them the creditors don't see it as no big deal.
    They will ask what circumstances led to the BK ,whether it will be medical or lost job.
    I have yet to have a consumer tell me that they just didn't want to pay their debt.
    You are wrong in doing so.
    I still believe you are trying to bait people here.
    I have been in Edmunds for almost two years and I have never heard such a post.
  • mazdaprofourmazdaprofour Posts: 202
    Is it so hrad to see that I am not going to pay and am going to file. Thousands of people do it every day. Go check out your local bankruptcy court. You will see rich folks and poor folks doing it. I am proud to be part of that club.
  • fezofezo Manahawkin, NJPosts: 10,376
    Ironically I have medical excuses up the proverbial wazoo. I have a blind eye with what blinded that threatening the other. I have arthritis. Last January I had a seizure and couldn't drive for two months. You know what? While I couldn't drive I kept up payment on two vehicles (I do not in any way recommend having two car loans at once but things happen) and all other debts. Just because things get difficult it doesn't make them impossible.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • That one sentence says soooo much about what's wrong with our country nowadays, it's scary.

    Proud to file BK?
  • saturnfansaturnfan Posts: 40
    Although it's illegal to discriminate against you for filing bk, some sensitive positions can be hard, but not impossible, to get with a bk on your credit record. Some of these are national security type careers.

    As I said, it's not impossible. I currently hold a sensitive security clearance in government but fully disclosed to them my bk and other issues in my past. After thorough inquiry, I was deemed loyal to my country (as I am) and was granted the clearance.

    It's nice to have a good atty, Mazda, although you can file yourself for the $200 filing fee + the cost of forms. There are also some legal filing firms that do uncomplicated paperwork for you in divorce, bk, and other routine uncontested legal matters. If problems arise, the value of a competent bk atty will be very apparent to you. The mark of a good atty is one that will sit with you, review your options with you, and not pressure you to take one path or the other.

    The money you pay an atty can be well spent, and a good bk atty will most likely cost you more than a paper shuffler. If there's any complicated aspects in your case, please go for a good lawyer.

    I had problems with one particularly arrogant creditor who wanted to intimidate me. A quick letter from my atty citing the appropriate sections of the U.S. bankruptcy code put the matter to a quick end.

    This forum is appropriate for the discussion IMHO since Mazda inquired about buying a car after bk, and buying cars is the subject of this forum.

    One comment from Voltaire may help here: ""I may not agree with what you say but will fight to the death for your right to say it".

    Regards to all, and to all a great night.
  • logic1logic1 Posts: 2,433
    If your lawyer told you he beat Sears on the reaffirmation problem, he is greatly exagerating. The Attorneys General of about 23 states spearheaded the action. Some private lawyers hung around to suck up money, but it was the various states, with their armies of taxpayer financed young attorneys and paralegals who did the work.
  • fezofezo Manahawkin, NJPosts: 10,376
    "I had problems with one particularly arrogant creditor who wanted to intimidate me. A quick letter from my atty citing the appropriate sections of the U.S. bankruptcy code put the matter to a quick end."

    Truer words were never spoken. My brother is an attorney and I am stunned at how quickly he can make things happen with a simple to the point letter that I can't get around. The example I always remember was when I was making my CD (I'm a musician part time). The duplicator already had all my stuff and then clearly was hitting th skids so I was getting neither my finished product or my original source material. Very frustrating and scary because I'd have to do some things all ovr again and I was operating on a shoestring. Unreturned calls, unanswered E-mail - you get teh idea. My brother wrote a letter briefly outlining our position and options - only a couple paragraphs. Had the discs in a week.
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • oldharryoldharry Posts: 413
    By one customer some years ago, that he filed BK, and the judge refused to discharge all his debts. In other words the judge refused the Chapter 7 because he had enough income to pay something. I am not a BK lawyer, so I don't know if this is common or not.

    Harry
  • rayfbairdrayfbaird Posts: 183
    OldHarry. That was extremely rare, but possible. Generally a bankrupt person has to be insolvent. Many people frankly qualify since you add assets and substract liabilities. If the balance is in the negative then the debtor is insolvent. I suspect in the case you had the person had a substantial income and could pay back at least 30% of his debts over 5 years.

    Mazda, Please make sure to list all of your debts regardless of whether they are joint or not. To fail to do so you could be indicted for perjury. So list all credit cards that you have joint obligations on. I would recommend getting your father's bankruptcy papers, and listing all of the creditors that might also apply to you. It is definitely best to list account numbers on all credit cards.

    Mazda -- Now, with relation to car expenses. Since you will be free of your own debts I would put at least $200.00 a month away while you can for car expenses. Your current vehicle will need some repairs along the way, and you can save the remainder for a good downpayment.
  • saturnfansaturnfan Posts: 40
    Actually, the Sears issue hit the fan because of a letter written to a bk judge by a person who filed on his own after suffering enormous medical and financial reverses.

    He told the judge that he couldn't afford to keep up his Sears cc payments. Sears had convinced him to reaffirm his old debt so as to be able to keep (of all things) a car battery he had charged. Sears did not get court approval for this as required by law.

    The judge went ballistic and really got on Sears in her district. My atty and others in bk practice in other areas filed against Sears for violations in their districts. Sears had to refund a lot of money and pay a large civil penalty.

    Several other store chains were also cited for this. Worst thing for Sears was that their own attys had questioned what the credit dept was doing.

    Oldharry,

    As you say, a case can be thrown out if the court deems it fraudulent. A false filer can also wind up with some felony time in "Club Fed". Both of these are rare but have occurred.
  • mazdaprofourmazdaprofour Posts: 202
    See this is the help that I was looking for. Not a lesson in the school of morals. Even though I say stuff to make whale mad, I am really ashamed of filing. It is never something you can be proud of. I am NOT and I reapeat NOT going to file again. This whole ordeal is very scary. I have gray hairs for the first time. Stress stress stress. I did bring some of this on myself and I know that. I am planing on keeping everyone posted on what I see. This is going to be a hard road to travel, but one road that I will detour in the future. Friday is the big day. Now to the people that have filed, how long was it before you got your discharge letter. I am getting 30-60 days from some lawyers and 3-6 months from others.
  • alfoxalfox Posts: 716
    Aside from sounding like a nice and honorable person, who has some experience with bankruptcy, what are your qualifications for advising mazda? Talking about buying a car after discharge is one thing, but dispensing advice on legal matters is another. We don't know what state he's in, what their laws are, or anything other than his side of the story. Don't you agree he should seek assistance from someone in his state other than a bankruptcy attorney?
  • cliffy1cliffy1 Posts: 3,581
    Don't tell Mazda what will happen when he tries to buy a car. I tried that and was told to jump in a lake and that this is typical of Toyota. I was told Kia dealers will be much more gentle with him.
  • wishnhigh1wishnhigh1 Posts: 363
    but then you have to drive a kia!
  • saturnfansaturnfan Posts: 40
    Mazda,

    Discharge time depends partly on the court's workload at the time you file. There's at least 30 days of time required to allow creditors to respond to the court's notice if they have an objection to assert. In my case, as my atty suggested, it took about 90 days before the discharge was granted.

    Alfox,

    You hit the nail on the head. I'm just sharing what I learned here. Although bk is a federal matter and is heard in federal court, there are major differences by state in exempt property. In FL and TX, you can go bk while retaining a multi-million dollar home via the homestead exemption. In other states, the exemptions are much less.

    Perhaps I'm spoiled by the quality atty I used. He and his partner always spend a large amount of personal time with each client and fully explain in person and with literature, the implications of filing bk.

    I'd trust their advice but, of course, Mazda could talk to CCCS or any moral/spiritual advisor of his choice if he wanted to get a different perspective. CCCS will tell you whether your situation looks like bk is the only way out. In my area, the advice is free.
  • mazdaprofourmazdaprofour Posts: 202
    Cliffy, you adivsed me that I would be forced into a 600.00 a month payment because of BK and that the dealer would not sell me a car even at 23% interest rate if I do not purchase extras like extended warrnty and more.

    Saturn fan, thanks for the advice.
  • nwngnwng Posts: 664
    Many landlords now pull credit reports on their prospect tenants. Landlords can say no if they see your credit stinks.

    Aside from mom & pop operations, most companies pull credit reports on their prospect employees. I know of many instances where the prospect employee was told to come back and apply again in 9 mos due to their credit.

    I was a credit counselor for a nonprofit group, there are a lot of people seeking credit counseling not because they cannot handle the debt, but due to the above two reasons.

    And yes, you will definitely get jacked by the finance guy at the dealership in the tune of a 25% interest rate and direct withdrawl from your paycheck. More lovely is that if for some reason the money didn't go to their account for one time, your car is gone. The dealer will sell your car and file a personal lien in the district court for the remaining balance of the loan, and that my friend, will not come off your credit history until you decided to pay it off, usually at the time when you want to take out a mortgage.

    I've also seen many ch 7 filings get refused but I did not know the reason why.

    Anyways, good luck!
  • fezofezo Manahawkin, NJPosts: 10,376
    2015 Mazda 6 Grand Touring, 2014 Mazda 3 Sport Hatchback, 1999 Mazda Miata 2004 Toyota Camry LE, 1999.
  • jb_thecserjb_thecser Posts: 24
    While hungrywhale was being a bit harsh on you, I think he's dead on. Why are you mad at him? If anyone should be mad, it's him, and the rest of us, not you. When people file for bankruptcy, they drive up the cost of goods and services for the rest of us.

    Sure, you'll get yours in the end, but it affects all of us! Don't you have any understanding of why others get mad when you say you're filing for bankruptcy even though you don't have to?
  • mazdaprofourmazdaprofour Posts: 202
    Jb, please please, no more moral lessons.
  • jb_thecserjb_thecser Posts: 24
    I wasn't trying to teach you anything. I was just asking you to look at the other side of the coin. If you looked at it from hungrywhale's perspective, you might understand why he's upset with you, that's all.

    I'm not upset with you, though.
  • mazdaprofourmazdaprofour Posts: 202
    Thank you. here is the way he might see it:

    He is a hard working person. He feels that a lot of people are taking advanatge of the system. They buy things with the intention of not paying back. They go out and buy things for family and freinds. In the end, he is the one that ends up paying for it. Why is he working hard while others are abbusing a system that was designed for the needy.

    I understand his point, but I did not do any of this on purpose. I did pay on may cards for the last 5 years. I had never been late. Even a before filing, I got offers for cards but I tore them up knowing that I could not pay them back. I could have gotten a hundred cards (like others do) and charged up more before filing. I did not due that. I did not even use my credit cards for the last year. So none of this was on purpose. I just see a dark future and am more scared of what will happen in a worst economey. Please guys, just give me advice without pointing fingures.
  • jb_thecserjb_thecser Posts: 24
    Don't file. I know you may be too far past this point to stop it now, but I think it's going to cause you even more grief than you can imagine (and I'm sure you're thinking it's going to be pretty bad). Paying all of it off will be tough, no doubt, but I fear that a bankruptcy will be worse in the long-run. I've heard that a reputable debt consolidation service like CCCS can really help a lot. It may be worthwhile to look into that. They may tell you that bankruptcy is your only choice, but they also may tell you that they can work with what you've got and get you on a manageable payment plan with lower interest rates. They're worth a shot, though. Go to www.cccs.org and check it out. The website is full of good information and although it's in Minnesota, I'd bet they can direct you to a local chapter. They're a nationwide not-for-profit organization.

    If you have to file, the rest of this still applies.

    Really limit your spending. Drive your same car for the next few years. Have $200-300 per month automatically debited out of your bank account right after you get your paycheck into a savings account or money market account. If you want to save money, that's the way to do it. Just like a bill, you pay yourself first. If you wait until the end of the month, there won't be anything left and you'll wonder where all the money went.

    Whatever you do, don't go back into the hole. If you can't pay cash for something, don't buy it.
  • wishnhigh1wishnhigh1 Posts: 363
    Aww...how convincing. Instead of stealing hundreds of thousands of dollars, you only stole tens of thousands.

    That does it for me...Im on your side now, mazda.
  • mazdaprofourmazdaprofour Posts: 202
    Best advice yet. I did do a volentary repo a few days ago. The car is going to force me into the bankruptcy. No doubt about that. I also have too many joint accounts with my dad. I am going to control my spending ...I have been controling it for atleast a year now. Once I file, I will be able to save around 700 a month. That is going right into the savings account. My seven hundred this month is going for the bankruptcy.
  • jb_thecserjb_thecser Posts: 24
    If you can save $700 a month, you could pay off your debts through CCCS. I'm beginning to lean back towards the whale's POV. Seems like you just don't want to pay.

    It's not too late until you actually file. CCCS might be able to get the negative equity in your auto loan rolled into your payment plan. Your credit will still show a repo, but that's much better than a bankruptcy.

    You're not even going to call them or look into it? You're bringing a whole world of hurt onto yourself that isn't necessary.

    By my calculations, if you owe $50,000, you could have that all paid off in about 7 1/2 years at 8%, with payments right around $700 per month. It would be faster with a lower rate. It would also be faster if you paid more per month as you got raises along the way. You could be free and clear in 5 years. Instead, you're going to have to take 10 and it won't be pretty. You're bringing 5 extra years of pain and suffering down on you and your wife. Why?

    A lot of people here (other than the whale, too)have suggested you look at CCCS (even some who have done it with good results), and you're not even going to look into it?
  • mazdaprofourmazdaprofour Posts: 202
    I will look at it but how can I tie up all my cash? and tell me what happens when I loose my job (as the economy goes to hell) and can not file bankruptcy anymore (once the laws have changed). Are you guys going to put food on my table and make sure the heat stays on? I can not risk that.
  • jb_thecserjb_thecser Posts: 24
    Why are you so sure you're going to get fired? Are you a bad employee? Is your company going out of business? If so, it may be time to start looking for another job (before you lose this one).

    Bankruptcy will always be around for those who truly need it. If you lose your job and can't find another, you would then qualify, I'm sure. It would be harder than it is now, but not impossible. There are always jobs out there, if you're willing to work, too. Deliver pizza, wait tables, go work retail, etc. They may not pay $33,000 per year, but they'd get you bye until you find another job in your field. Lots of people your age wait tables either as a second source of income, or while they are in-between jobs.

    Who says the economy is going to hell? Personally, I think it's about as bad as it's going to get, and most of the data (aside from the stock market) agrees with me.
This discussion has been closed.