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Bankruptcy and Vehicle Financing
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If we're trying to avoid people from becomming "indentured" through circumstances largely beyond their control (former Enron worker whose son has Lukemia, crash victim unable to work, or even the victims of a serious shift in the economy) then I agree.
If we're trying to help people who cannot make the connection in their minds between the ease borrowing and their own responsibility for repayment, then I think the process should be a bit more painful. It should almost always involve some element of repayment balanced with a degree of penalty. The notion that someone who has everextended himself to the point of insolvency should be able to have all his debts discharged and then buy a new car is mind numbing, and inherantly wrong, IMO.
:-)
Considering what brought you to the bk court, looks like you've profited from the experience and will do better from now on.
Best wishes
Irresponsibility?
Why not stop blaming everyone else and take charge of your own life? Aren't you really smarter than sucker ads? Or are you THE target demographic.
Geeeze!
I'm in a wholesale business,like car manufactuers,I must get my product out there.I rely on my dealers to make wise choices so they can continue to buy my product.When times are uncertain I ,as well as my dealers, must take risks.Just because someone goes BK does not mean I can afford to loose his future business-it will just have to cost him more.
The circumstances of the BK are much more imp to me then the BK itself.We all make bad decisions in some areas-money being the most common.Premeditation rather then overextension is what I look for.This can usually be determined quickly.
As far as being doomed to being fat and poor;look around you,it's happening.I guess in an ideal world all-u-can-eat buffets would refuse service to an obese person.Here again it's just business.
In an adult world, people control what goes into their own mouths. Corporate bankruptcies are a different animal than personal, as are personal ones that result from circumstances beyond an individual's control. But the pervasive and growing perception that "my debt is the fault of the lenders, but I can wipe it clean with bankruptcy and get a fresh start...." is utter nonesense, and simply feeds the current I'm-a-victim, screw-big-business view of life in America.
Cease the morality postings. Further posts of this nature will be sent to senior management for suspension review. Is that clear enough?
kcram
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The first had a BK 5 years ago - now has a score of 697. Sure there are some banks that won't touch this person but for the most part they can get the same rates as someone who never filed BK.
The second had a BK 3 years ago. Score was 667. Still has to pay a little higher rate than your best credit people but can still get low rates.
The third had a BK 8 years ago - was concerned about his credit because of it. 750 score - computer approved for tier one rates.
In 1992, got approved by Ford Credit at 14%. In 1994, traded for a Mazda at 9.5%. In 1996, got a Saturn at 9.25%, and got all tier 1 rates from then on.
Bk is off credit report now and was approved for my new Corolla at 6.5% by a conservative local bank.
As we see, it does hurt your credit for a few years, but you can rebound if you keep your finances in order. In the beginning, only "bottom feeders" wanted to give me a credit card, but now have no problem. Keep 1 Visa with my bank, $1,500 limit, and pay in full each month.
Hope you do as well, mazda. Best to you and your family.
Bob
While I apreciate the moral debates and such I understand that we're ona car site here.
I really applaud mazda for keeping us up to date on this. It would have been really easy to duck the whole thing when the debate got ugly. I've certainly learned more about the subject than I ever suspected I would - or would even want to! Most interesting is the fact that it seems either way you go you can recover if you're serious about it and that it's a more complex decision than I would have thought.
That said, I'll tell you - getting that score up once you are in the clear buys ou a lot of freedom - mostly because it gives yo back the decision making power on where your money goes. Example - the reason I've been away was I've been in China picking up an adopted daughter (daughter number 4 - first adoption). I could not afford the cost and borrowed on the equity on my house. It was there because I was careful to have it there. You'll enjoy that kind of freedom when you get there - others here can agree on that.
Best of luck, mazda - keep us posted as it goes along. You have made some good decisions based on what advice you've gotten here which is the whole point of this. Hope the Sable holds up - that will really help! And you have options laid out now if it doesn't.
I am still awaiting my court date (July 24th). The interesting thing is that I got a letter today. It looked very official. It said "we have been notified of your chapter 7 filling. We wanted to give you the opportunity to purchase a vehicle from us at a substantial discount, buy you must purchase prior to your 341 hearing". This is a nice scam...I did not know that the courts made filling information available to outside companies. I guess these guys check with the courts to see who has filed recently and try to target them. The bad thing about this scam is that you can not buy a car if you have just filed until your hearing or the case can be thrown out. But I guess a few people fall for this trick. I tore it up. With a few days left, I am getting excited to get this over with. The sable is holding up so far. After my hearing is over, I am going to open my photography business in atlanta. I will have to look at a new vehicle. The lab that I print my film with is 30 miles from my house. I already do 50-60 miles a day so I do not see this sable taking the high miles for too long. The atlanta heat is not kind to a car. I will have to buy a new car to keep up with me. If I miss a wedding do to car peoblems, that will hurt me bad. One late arrival at a wedding, can cost me hundreds of dollars. The business will pay for the new car in no time. Heck If it gets really good, I can make double payments on the car. We shall see. But anyway, I will cotinue to keep you guys posted.
I arrived at the court 1 hour ahead of time. I located the hearing room and quietly made my way to the back. I sat down and looked around. This was a fairly small room with a table in the middle and a trustee at the table. All the clients and lawyers where sitting down. The trustee began by pressing the record button and stating the date and time of the hearings. He began by going down a list to make sure that the lawyers and clients where present and ready. Some clients waited on the late lawyers and some lawyers waited on the late clients. These cases where moved up to a leter time by the trustee. He called up the first client and lawyer. They both sat down at the table. The lawyer sworn in the client and it began. The trustee asked for the ID of the client. The client was asked to state name and address. The following questions began by the truste:
1-how did you calculate the value of your home?
2-do you have any pending lawsuits?
3-have you been seriously injured in the last 2 years during a motor vehicle accident?
4-does anyone owe you money?
5-why did you claim bankruptcy?
6-has the lawyer went over the bankruptcy law sheet with you?
7- is there any lawyers present in the court room that this client has a debt to (in 90% of the cases, no opposing lawyers appeared).
This all took about 5 minutes and the trustee would say thank you you are done.
After watching 10 of these, I knew it was easy.
I went through the routine and a lawyer did appear for the company that I had my previous repo car with. She just asked me if I had returned my car and if it was in good condition. She also told the trustee the car balance was 20K and value was 12k. He signed off on everything and that was it. All went great. I went to honda and found out that I will need 3k down to get a loan right now. So that is not too bad. I am waiting to save up. Any questions? hopes this helps anyone that has any fear about bankruptcy....it is not as scary as some may make you think it is....no whips and no jail
a) You were smart, contrite and did not try to stretch yourself too far into debt again; or
b) The system is too easy to work, and fast credit is too easy to get, which will victimize us all in the long run; or
c) You are insensitive to the effects you have on others, and don't really care; or
d) A combination of b and c, which scares me a bit.
I offer my honest wishes for a secure and sucessful future, and my hopes that your life tracks down the "a" corridor. Good luck.
That was a great thing to do, and you deserve a lot of praise.
Mazda,
Just like my hearing - 5 minutes. Surprising the creditor's lawyer was so unprepared. Why on Earth did she even bother to come if she had to rely on you for the info.
Can't tell why you got the purchase offer. Normally, only reaffirmations of existing debts need to be done before discharge. Perhaps your atty can tell you if the offer was a scam. If so, the bk judge's staff might like to see it.
Hope your new career goes well. Maybe you'll wind up in a Benz down the road. Just got a new 2003 Corolla CE for $13,996 full MSRP, and it's quite a lot for the money. Five speed gets 35 - 40 mpg. Might want to check it out if the Honda dealers are hitting you on the high side.
"b) The system is too easy to work, and fast credit is too easy to get, which will victimize us all in the long run; or
c) You are insensitive to the effects you have on others, and don't really care; or"
Who is victimized and what effects does BK have on others?
Would be most unusual for a creditor to object unless there's a smell of fraud in the air, so this is normally just a formality.
With that downstroke, you should be good to go for a new car. Struts and tune up are probably optional unless the handling's so bad that it won't wait or will fail state safety inspection.
I'll restate : Who is victimized and what effects does BK have on others?
Maybe you should look for the topic "I don't know what I'm talking about" and post there?
kcram
Host
Smart Shopper and FWI Message Boards
Hope it goes as well as it sounds. Keep with the program, save that $3,000+ and learn from the mistakes.
It's amazing how all of a sudden you can work extra hours so you can buy a new car,but couldn't do it before.
I still say hold on to that Sable and keep saving.
I don't think buying a new car is the way to go - you're going to pay an extremely high rate of interest. Better to finance a small amount, unless of course you plan on paying the entire loan off in 12-24 months in which case the rate won't make a huge difference.
Maybe it would help to not picture the monthly payments you can afford, but think of it as taking on ~$15k in debt. Isn't that a good percentage of what you just wrote off?
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I would guess, that if you have a problem with your first loan after a BK the next one is going to be hard to get.
Objectively, I think you'd be better off to buy a used car for $2,500 - take a small loan for that first after-BK-high-interest loan and bank the rest of the money you're making working OT. Sure the savings interest rates aren't great right now, but you'll have money for repairs if you need it, and you'll have a month or two's worth of payments available if you need them. By the time your used car dies, you'll have more money to make down payment with, AND you'll qualify for a lower rate.
Then they wonder why they get in trouble a second time....
I see this all of the time.