Going Bankrupt...

[Haircut]

If someone is forced to declare themselves bankrupt through unforseen circumstances, then I might have some sympathy.
People like the waste of space in the link above should be forced to do manual labour to pay back their debts as far as I'm concerned.

I hate it when people say, 'Oh I was stupid' or 'They shouldn't have lent me the money' as if that's some sort of excuse. Just because you acted foolishly doesn't mean you should be helped out. Surely making good decisions should be rewarded, not idiotic ones?

 

[Deleted User 234324]

The worst people ive encountered are those that have gone bankrupt then 18 months later they are back in wanting to go bankrupt again, in those situations we tell em to bugger off.

I personally am more than willing to help those that are genuinly having financial difficulty, either due to illness or sudden unemployment, but people that spend money needlessly on pointless luxuries which they do not need, should not be given a get out of jail free card.

a family man with 2-3 kids on a low income might rightly have to resort to credit/finance just to survive, but in that situation taking your family on holiday to another country for example is just wrong, if you can't afford it you can't have it.

I would like to see banks/lending companies put strict requirements for credit, currently they do not check details with regards to income/life style and they should. Im on 19k, never been in debt, never gone into my overdraft, don't have any credit cards/loans, but banks refuse me credit.

If anyone watched the channel 4 program on monday about christmas debt you will see that a girl earning £100 a week in a pub who had one credit card with a £0 balance got given just under £6000 in credit just buy going to different banks in manchester. She would never be able to pay that back, its almost 50% more than she earns in a year.

Thats how messed up the system is.

 

[mattyfez]

The important thing to note here, is that individuals becoming bankrupt is quite silly.

if the lender had done thier homework, they would know they cant pay, there was a case a few years back where a guy on benefits managed to rack up a £30,000 debt.

The lenders probably rely on some kind of scheme to get money back from bad debts, because no one in thier right mind would give credit to someone if they have no means of repayment.....yet it happens all the time.

this is purely about un-reponsible lending, relying on penalty charges to make massive profit.

 

[Tute]

I can't believe some of the replies in that thread either. She's admitted that it's all her own fault - so she gets no sympathy from me. Bankruptcy should be for people who are in financial trouble through no proper fault of their own.

Another thing that really grates with me is that on the day of the court appearance she's still smoking away. Am I the only one who thinks smoking is a luxury? Try ditching the fags love - save yourself £5 a pack of 20.

And it doesn't matter how "easy" companies make it for people. You have a brain in your head, and a tongue. Try using the word "NO". I get junk mail through telling me i've been accepted for thousands of pounds on a credit card. I just pass them all straight through the shredder.

 

[Muffin`]

I would like to see banks/lending companies put strict requirements for credit

They were in place but they were removed and we have the situation we have now, and with Media playing it off as the end of the world it just makes situations like with Northern Rock ten times worse. But I don't know if the restrictions should be in place, whatever keeps things stable, might induce recession, but if it stop banks going bust.

currently they do not check details with regards to income/life style and they should. Im on 19k, never been in debt, never gone into my overdraft, don't have any credit cards/loans, but banks refuse me credit.

If you have no history what so ever then you are unknown to the Credit company's, it would help if you get a credit card and pay for things on it then pay it off at the end of the month, it won't cost you a penny and will help your credit immensely. Also by paying off credit monthly and not in one lump sum also helps your credit rating.

 

[Moorron]

im with those who think its a pxxx take to get into such dept and then have a aesy way out. I get really annoyed at the adverts on tv that paint a rossy picture of how getting an nother loan with make it easy for them, when its the last thing they need.

I would say im live a reserved life with little dept, me and the mussus owe a total of £62K and that includes a 60k martgage. We dont spend beyond our means, but still have toys like ps3, 4 cars (me x 3) and things like mobile phones and cable tv which i think arnt nessasary. i think a lot of newer generation people think that the above things are nessesary and that the system owes them to them.

A very good friend at work is the totally opposite, i would say he is the best person at calculations off the top of his head, but the poorest at personal finance. His life is totally different to mine, im not saying it worse just we have different view on what life is about. He just bought a larger house, stretched his mortgage so he had 10K to spend of toys and stuff all of which have never been used or are broke now! He had to pay £1000 to get a mortgage as he had CJD's after refusing to pay his council tax a few years ago. Thing is he plays the system too, after getting a 10K loan he knew that after a few months he could stop paying it back, they would threaten then after getting no where would sell the dept on to another company and the cycle would resume. He knew if he ignored the payments for long enought they would offer a 'settlement payment', i think it was 6K, he then sobbed over the phone and said he could only afford 4.5K. They excepted!

so to sum it up he had 10K,
refused to pay it back
lots of letters and time later he gets to pay it all off with 4.5K!

I just dont understand it!

Now the latest thing isnts bankruptcy but some other thing (cant remember the name) that means no stigma attached and an even easier way out.

If you arnt punished from making mistakes (on purpose or not) then you dont learn and will do it again.

its only going to get worse.

 

[Baz]

Now the latest thing isnts bankruptcy but some other thing (cant remember the name) that means no stigma attached and an even easier way out.

If you arnt punished from making mistakes (on purpose or not) then you dont learn and will do it again.

its only going to get worse.

They are IVA's, Individual Voluntary Agreement, it has no repercussions like bankruptcy, so ideal if you are a director or the like, you don't lose your house or car so to speak, but you have to pay it back over 5 years. Not suitable to everyone, especially not those with more than £15k of debt.


Why do people think that Bankruptcy isn't punishment?

 

[Kemik]

I honestly don't understand how people (unless in very extreme circumstances) can go bankrupt.

You must look at your incomes and compare them to your outcomes. Even if it's only when you realise you're running out of cash! You think, right my outcomes are more. What do I need to live? I've cut it down to a minimum. If you're really desperate you'd take showers instead of baths to cut down water bills, turn off radiators for rooms you never go in and close the door, etc. Stop smoking for a first in her case.

You would never buy a house or rent a flat if you worked out you cannot afford it so I'm guessing she's racked up more outcomes after purchasing somewhere to live.

I just don't see how people can not think "Can I afford this?". So what if companies are willing to give you money, don't take it?! She smokes so it's obvious she has no willpower.

If you're living at a minimum and still loosing money then move to a smaller place, or rent with friends or get a second job while you work off the debts you some how managed to get yourself in to.

Extreme circumstances I would say are unexpected health bills (e.g. dentist, funeral, etc), you've been made redundant (not fired caus then it's your own fault). You get the idea.

 

[mattyfez]

this is purely about un-reponsible lending, relying on penalty charges to make massive profit.

Ill quote myself, the lending companies should be more prudent, instead of relying on income from missed payment charges, which is where they make most money.

more regulations are needed to fix this mess.

 

[helmet]

What does pensioners have to do with bankruptcy?

It was two extremes and one of which I'd just seen on the news, the other in here.
Well for one you don't see them opening up credit routes just to heat their homes (or even just to pamper themselves), even though they could, and why don't they do this? Well that's down to common sense and respect that comes from years of being accountable for your actions, not just with credit.

riddler, comment taken on board, I'm trying to source myself a t-shirt with that on it as I'm typing this.

I'm not going to talk about personal situations so this is not aimed at your father, friends, or great grandmother.
For me, moving yourself into any amount of debt requires thought and to play the "What if...." game quite a bit, now if people are too lazy, distracted, or ignorant to do that and neglect to plan out even death as a factor in taking on credit then they should not be allowed to gain any debt/credit, simple as.

It's only money after all.

 

[Baz]

I honestly don't understand how people (unless in very extreme circumstances) can go bankrupt.

You must look at your incomes and compare them to your outcomes. Even if it's only when you realise you're running out of cash! You think, right my outcomes are more. What do I need to live? I've cut it down to a minimum. If you're really desperate you'd take showers instead of baths to cut down water bills, turn off radiators for rooms you never go in and close the door, etc. Stop smoking for a first in her case.

You would never buy a house or rent a flat if you worked out you cannot afford it so I'm guessing she's racked up more outcomes after purchasing somewhere to live.

I just don't see how people can not think "Can I afford this?". So what if companies are willing to give you money, don't take it?! She smokes so it's obvious she has no willpower.

If you're living at a minimum and still loosing money then move to a smaller place, or rent with friends or get a second job while you work off the debts you some how managed to get yourself in to.

Extreme circumstances I would say are unexpected health bills (e.g. dentist, funeral, etc), you've been made redundant (not fired caus then it's your own fault). You get the idea.

Not everyone is as perfect as you

 

[mattyfez]

Not everyone is as perfect as you

exactly, if a credit company finds they have a customer who is unable to pay them, its thier own fault, and no one elses.

They should not have the right to charge hundreds of % interest on missed payments, because missed payment charges make up most bad debts.

 

[Yeggstry]

Just LOL TBH - this is going to get so much worse next year...

I thought this looked familiar: http://www.housepricecrash.co.uk/graphs-average-house-price.php

Looks like there is a year delay or so, I'm 23 and looking for a first house so I'm going to be watching this very closely. Certainly house auctions are going to get a lot of business shortly...

 

[Deleted User 234324]

They were in place but they were removed and we have the situation we have now, and with Media playing it off as the end of the world it just makes situations like with Northern Rock ten times worse. But I don't know if the restrictions should be in place, whatever keeps things stable, might induce recession, but if it stop banks going bust.




If you have no history what so ever then you are unknown to the Credit company's, it would help if you get a credit card and pay for things on it then pay it off at the end of the month, it won't cost you a penny and will help your credit immensely. Also by paying off credit monthly and not in one lump sum also helps your credit rating.

See its a double edged sword, for legittimate people like myself who would like to get for example a credit card as it offers better security online, we get shafted.

I can afford to pay back a credit card as I have in excess of 600 a month disposable income but because im not on "their" system they refuse me credit.

To get a credit card/loan you need a decent credit rating, to get a decent credit rating you need a credit card/loan. Even the insanely high APR cards are impossible to get if your not on their system with a decent rating, I believe its rated out of 1000 and to get even the basic of credit cards with 34.x% APR requires a credit rating of 550+.

They do also take into account, where you live, your neigbourhood (is it a s*** hole or respectable area), weither you are on the electoral roll or not and several other things.

What they should be looking at is, how much do you earn, can afford to pay it back in your current circumstances and more importantly what is your life style like. For example when you get paid do you blow the lot in a week or does your bank account have a couple thousand pound balance 24/7. In the latter case your more likely to be able to pay back what you borrow, in the former you less likely to be able to cope with sudden expenses and miss out on payments or not pay at all.

 

[Baz]

exactly, if a credit company finds they have a customer who is unable to pay them, its thier own fault, and no one elses.

They should not have the right to charge hundreds of % interest on missed payments, because missed payment charges make up most bad debts.

I totally agree, the banks/lenders are to blame as much as anyone. If the credit wasn't there in the first place, the temptation wouldn't be there either. I agree some people play the system to their advantage, and these loopholes need blocking as its blatant fraud!

 

[Dolph]

I thought this looked familiar: http://www.housepricecrash.co.uk/graphs-average-house-price.php

Looks like there is a year delay or so, I'm 23 and looking for a first house so I'm going to be watching this very closely. Certainly house auctions are going to get a lot of business shortly...

You do know that the definition and ease of bankruptcy changed dramatically in 2003?

Reading that thread on moneysavingexpert, I would seriously wonder about why people ever recommend the advice of their forum... Seems like they recommend a charter of irresponsibility.

 

[Muffin`]

I totally agree, the banks/lenders are to blame as much as anyone. If the credit wasn't there in the first place, the temptation wouldn't be there either. I agree some people play the system to their advantage, and these loopholes need blocking as its blatant fraud!

Its the company's fault

The temptation is there to drive a Ferrari, I just have to walk into their home with a knife and stab them, but they shouldn't have it in the first place, the temptation is just too strong!

 

[Moley]

exactly, if a credit company finds they have a customer who is unable to pay them, its thier own fault, and no one elses.

They should not have the right to charge hundreds of % interest on missed payments, because missed payment charges make up most bad debts.

Actually it goes deeper than that. Did you know for example that most banks larger debts are insured? If you borrow 100k from the bank and don't pay it back they get it paid out in insurance. Combine that with the repayments you *did* make and they've made a nice bit of profit with *no risk* to themselves.

No wonder they are falling over themselves to give out bad credit...

 

[Muffin`]

.

For credit cards if you have so much money a month and can afford to pay it off no problem your dead water to them, they make no money whatsoever, its good business for them to take people who they might make some money on.

Loans are different, as they will make money on you.

 

[todd flanders]

Why bother with bankruptcy when you can just buy a canoe?

Seriously. I used to work with a guy who declared himself bankrupt, or a form of bankruptcy and didn't have to pay income tax for twelve months. Does that sound right?