Making harder to file Chapter 7 bankruptcy

[Duty Honor Country]

Come mid October, it will be harder for anyone in the USA to file for Chapter 7 bankruptcy. Chapter 7 bankruptcy is where someone is forgiven for all the debts that they have created. Right now there is a huge surge in Chapter 7 filings before the new law goes into effect.

READ ABOUT IT VIA GOOGLE NEWS

This law is extremely political becuase most democrats are against it. Their position is that the law is unfair to those who are in debt because of lost jobs and such.

I am quite supportive of this law. I know it will cause some pain and hardship to those who are in debt. BUT you reep the consequences of your actions. Americans today are spending more and saving less than they ever have in its history. I watch people blow thier paychecks away without the slightest regard to planning for a financial crisis. I think the figures say about 75% of families will face a financial emergency of $5000 or more in any 10 year period. Since I have made sacrifices inmy spending habits and lifestyle to stay out of debt, I have little sympathy for those who live the good life in debt.

If you need to know, I did have a brush with debt. It took me a year to get out of it and I have vowed never to be in debt. My morgage is the exception. It is a little hard to raise $110,000.

Doody

 

[Ted]

Okay guys, here I go. Eventhough I have a warm heart for the military I vote left. I too, have been in the cellar of financial fortune, but luckily I have a good brain to help me out.
In Holland we are more of a nurture state then nature and this influences my train of thought.

I think that a government has the responsibility to take care of it's people. By making it harder you "punish" the ones who work hard but didn't make it. The ones abusing the possibilities (we have them too overhere) get my contempt, and something should be done about that. But to go top down you immidiatly nullify that law. Everybody gets the short end of the stick and why did they make that law for in the first place?

In Holland we started to link all different computersystems from all kinds of institutes. We started to cross reference many facts and are quite able to weed out many parasites. So before you toughen the law, make them more effective first! And if you immidiatly go off and punish everybody, what risk will somebody take to make something of his life?

 

[Whispering Death]

In America debt is a way of life. I'm all for changing that.

 

[Ted]

If that is so, I'm all for the upgrade. We Dutch are known for our tight-on-the-budgte-you-can-only-spend-money-once attitude. And I actually like to spend "my own" money and living on borrowed monay all the time isn't good.
If the economy goes down the drain, interests are going through the roof... well, then it a bloody mess if you have to pay back the money you spent on consumer goods!

 

[bulldogg]

I voted not sure. Reason being I think you can't quit this kind of spending cold turkey and have the country survive financially intact. An entire economy is built around patterns of consumption that have led to this point. You can't go for some magical quick fix, the lawyers will fins away around it just like they do with all the bloody tax laws. Additionally you have to address the problem of the advertising which feeds the mentality of addiction. I don't believe there is a simple solution to this problem but I do believe it must be addressed.

 

[mmarsh]

Doody (I voted NO)

I am going to have to disagree with you. Here's why:

Most debt in US (over 50%) is caused by medical emergency. Loss of employment, or Death of the principal wage earner are a close 2nd and 3rd.

Yes there are a few people that cheat the system by declaring Chapter 7 but they are a small minority. The credit industry (the primary backers of this law) have the most to gain by this law as it now means they can seize assets (such as your house) that were previously protected by the old system.

In addition, this law is unbalanced as there is a specific exclusion for houses worth more than $2 Million. That means if your house is worth more than $2 Million the credit agencies cannot repossess it.

I just feel kicking American families when there down is awfully cold espically when you consider that the financial institutes have so much to gain. I'd also like to point out that the financial institutions were the largest backers of Bush Campaign in 2004, so the passage of this bill is more about kickbacks to political contributers than it is to helping ordinary Americans.

 

[ironhorseredleg]

I voted yes, but I don't agree with the new law's method of accomplishing it. I think America's bankruptcy laws need to be revamped, but they need to be revamped to 1) protect folks who are earning a regular wage and, 2) make it possible for folks to pay off their debt.

I was making $50,000USD a year and then lost my job through budget cuts (state level educational funding cuts, actually). We had purchased a new home in March, and I found out in May that I would be without a job July 1st. I was unable to secure a similar job, and even received partial unemployment for several months because my new jobs combined made less than my previous. After a year of trying everything we could and expending our savings, we were unable to sell our home and entered bankruptcy. With me working 2 jobs and my wife working 1, our debt was so much greater than our combined incomes that the only bankruptcy option we had was Chapter 7.

 

[Pyro]

I voted yes, but I don't agree with the new law's method of accomplishing it. I think America's bankruptcy laws need to be revamped, but they need to be revamped to 1) protect folks who are earning a regular wage and, 2) make it possible for folks to pay off their debt.

I was making $50,000USD a year and then lost my job through budget cuts (state level educational funding cuts, actually). We had purchased a new home in March, and I found out in May that I would be without a job July 1st. I was unable to secure a similar job, and even received partial unemployment for several months because my new jobs combined made less than my previous. After a year of trying everything we could and expending our savings, we were unable to sell our home and entered bankruptcy. With me working 2 jobs and my wife working 1, our debt was so much greater than our combined incomes that the only bankruptcy option we had was Chapter 7.

wow. sorry to hear that. i voted not sure for the poll. its not fair to those that have had to go Chapter 7 when their cause is medical related.

 

[Ted]

Isn't that the way things go? If you make a law accessible for the people who really need it, you'll have vermin abusing it. If you toughen the law as to make it harder for the parasites, the really need have a big chance to get the short end of the stick.
So what do you choose for: abuse by a few or the downfall of some honest ones? I'll go for the latter...

 

[mmarsh]

Ironhorseredleg

I am sorry to hear about your situation, having been in a similar scenario myself a few years ago, I wish you the best of luck.

I would like to point out that your experiance (noted in my above post) is exactly the reason why I voted NO. You do realise of course that under this new law you might not be (depending on the details of your situation)longer protected by Chapter 7. People who become bankrupt due to misfortune should not have to be punished a 2nd time in a row.