Thinking about declaring bankruptcy, but first maybe buying a new car.

[Grminalac]

I have been seriously thinking about declaring bankrutcy as my bills are astranomical. I graduated college with a computer science degree from PSU, but did not find any work in the local area right out of school. (I live north of pittsburgh.) So for some time I basically used my credit cards relentlessly as a means of living and or doing anything. Paying rent, utilities ect.. Plus student loan and bills from school, one semester I had to put my entire rent on the credit card. While working various jobs, Wal mart right out of school, many but mostly total crap when it came to pay. I have basically been making minimum payments on everything. As of last year I got a job working for the commonwealth. I am making very good money, but the debt (over 50 grand) I have is making it impossible to meet my bills, and not have to move back in with my parents. look I'm not blaming anyone else, but me for my stupidity in getting myself in that deep. Its just that I try to make the payments and only get grief from the creditors. take last month for instance my bill was late a second time in 6 months so my APr jumped from the low 6.5 to a whopping 22%... How can they expect me to pay them back at that rate??? I was doing my best effort to pay back as much as I can and still eat and maybe afford a cable/internet bill.

I actually spoke to an attorney and he went over the details, on a lighter note he advised me to purchase a new car before declaring and wiping out my unsecured debt, as i can keep the loan and continue to pay after declaring, unlike afterwards where the interest will be higher. I kinda think this is an outrageous idea, although the prospect of going out and buying a new 5 series or a mercedes c class as making a 600 a month payment would not be a problem after wiping out my credit card debt, as my car payment is 340 now and I try to pay 700 a month on those damn cards. He told me the higher my bills are when declaring the better. (although obviously he advised me it is fradulent to buy things only to declare bankruptcy on later, i wouldn't buy a bunch of stuff in hopes to get it free of course)
i dunno some feedback would be helpful. Maybe some insight from people that have declared previously.
Thanks

 

[308nato]

Our forefathers insured that all Americans would have the right to declare bankruptcy to avoid debtors prison and indentured servitude.

Buying a new mercedes wasn't on their mind at the time.

Knowing someone who acts as a bankruptcy trustee, I can tell you that it won't help your case much.

 

[McPhreak]

Originally posted by: Grminalac
I have been seriously thinking about declaring bankrutcy as my bills are astranomical. I graduated college with a computer science degree from PSU, but did not find any work in the local area right out of school. (I live north of pittsburgh.) So for some time I basically used my credit cards relentlessly as a means of living and or doing anything. Paying rent, utilities ect.. Plus student loan and bills from school, one semester I had to put my entire rent on the credit card. While working various jobs, Wal mart right out of school, many but mostly total crap when it came to pay. I have basically been making minimum payments on everything. As of last year I got a job working for the commonwealth. I am making very good money, but the debt (over 50 grand) I have is making it impossible to meet my bills, and not have to move back in with my parents. look I'm not blaming anyone else, but me for my stupidity in getting myself in that deep. Its just that I try to make the payments and only get grief from the creditors. take last month for instance my bill was late a second time in 6 months so my APr jumped from the low 6.5 to a whopping 22%... How can they expect me to pay them back at that rate??? I was doing my best effort to pay back as much as I can and still eat and maybe afford a cable/internet bill.

I actually spoke to an attorney and he went over the details, on a lighter note he advised me to purchase a new car before declaring and wiping out my unsecured debt, as i can keep the loan and continue to pay after declaring, unlike afterwards where the interest will be higher. I kinda think this is an outrageous idea, although the prospect of going out and buying a new 5 series or a mercedes c class as making a 600 a month payment would not be a problem after wiping out my credit card debt, as my car payment is 340 now and I try to pay 700 a month on those damn cards. He told me the higher my bills are when declaring the better. (although obviously he advised me it is fradulent to buy things only to declare bankruptcy on later, i wouldn't buy a bunch of stuff in hopes to get it free of course)
i dunno some feedback would be helpful. Maybe some insight from people that have declared previously.
Thanks

Lemme get this straight...you're 50k in the sh!thole, and you not only want to buy yourself a car, but you want to buy yourself a Benz or Mercedes.

Am I missing something?

 

[A5]

Wait, you're 50 grand in debt and think you can actually get credit from a Mercedes or BMW dealer? Riiiiiiiiiight

 

[LAUST]

He wants you to go out and buy a car that would just hold you in check for another 60 month's of your life?

 

[notfred]

You really think you'd be able to keep the car if you declared bankrutcy? I think I'll go buy a Million dollar house and declare bankruptcy before I make the first payment, I'm sure I can keep it, right?

 

[MacBaine]

Have you been hanging out around Skoorb

 

[slikmunks]

Originally posted by: LAUST
He wants you to go out and buy a car that would just hold you in check for another 60 month's of your life?

that's where declaring bankruptcy comes in.....

 

[CrazyDe1]

I hate people that do this...suck it up and go move in with your parents....
Instead of paying off my debt or living within my means I'm just going to rack up debt...50k in debt nonetheless....and declare bankruptcy....while I'm at it I'm gonna go buy a new car...a friggin beamer at that...

 

[rickn]

Originally posted by: notfred
You really think you'd be able to keep the car if you declared bankrutcy? I think I'll go buy a Million dollar house and declare bankruptcy before I make the first payment, I'm sure I can keep it, right?

You can choose here in Florida to leave off certain creditors from your bankruptsy. I had a friend who declared it, he was able to leave off his car loan.

 

[Reel]

As it was explained to me by my Uncle (a lawyer and judge) when I was having a legal discussion with him, the law has certain shields (i.e. bankruptcy) that help individuals. However, if an individual attempts to use a shield as a sword (as you describe), you will lose the legal protection at the judge's discretion and they will possibly come down on you hard.

 

[Vic]

Originally posted by: McPhreak
Lemme get this straight...you're 50k in the sh!thole, and you not only want to buy yourself a car, but you want to buy yourself a Benz or Mercedes.

Am I missing something?

You're not missing anything. Working in the finance and lending industry, I talk to deadbeats just like him all the time. :| :| :|

Pay your bills, deadbeat, the rest of us do.

 

[Grminalac]

yeah, believe me they will give me the credit. Would you believe that my credit card limit is over 120k on all my cards? Its sad but true, charging tuition and then paying off the balances when the student loans come though gives a person an amazing amount of credit. There is no doubt in my mind that I could buy/lease a 50 thousand dollar car tommorrow. In fact last month on a whim I went in a caddilac dealership just to take a test drive in an escalade, I wasn't buying one. They started pressuring me to buy and even brought up paperwork on a GMAC smartbuy at 790 a month. All I had to do was sign.

In reality my goals should be buy an economical car, as I am driving a BMW 3 series right now, albeit with 70k miles almost up in warranty. I tried to trade my car in and get a good deal, but noone is willing to give me anything close to what my car is worth and that would just make me owe more money... II should buy something like a honda or whatnot. Maybe seek credit counseling, before declaring although that will not help pay my rent currently.

 

[HappyPuppy]

You, sir, are a scumbag. You are the reason that the rest of us have to pay high interest rates.

Why don't you just suck it up, get your finances in order and pay off your rightful debts?

Get a second job, work seven days a week if necessary. You got your education by promising others that you would repay them. Now do it!

 

[everman]

Buying a new Mercedes and then declaring bankruptcy like that is like putting a big neon bullseye around your neck for your creditors.

 

[Zebo]

Go for it.

Chapter 11 and you'll get to keep the car and pay probably around 1/4 of it's value to pay it off. Hell I knew a girl once who made only 33K and her dry cleaning bills were $400 a month and the jude let her keep her new grandam.

 

[McPhreak]

Originally posted by: Grminalac
yeah, believe me they will give me the credit. Would you believe that my credit card limit is over 120k on all my cards? Its sad but true, charging tuition and then paying off the balances when the student loans come though gives a person an amazing amount of credit. There is no doubt in my mind that I could buy/lease a 50 thousand dollar car tommorrow. In fact last month on a whim I went in a caddilac dealership just to take a test drive in an escalade, I wasn't buying one. They started pressuring me to buy and even brought up paperwork on a GMAC smartbuy at 790 a month. All I had to do was sign.

In reality my goals should be buy an economical car, as I am driving a BMW 3 series right now, albeit with 70k miles almost up in warranty. I tried to trade my car in and get a good deal, but noone is willing to give me anything close to what my car is worth and that would just make me owe more money... II should buy something like a honda or whatnot. Maybe seek credit counseling, before declaring although that will not help pay my rent currently.

Why don't you sell your BMW, move in with your parents and pay your debt off?

 

[Bignate603]

That's a bastard move man. you may be able to do it but you have no dignity.

 

[Zebo]

 

[Grminalac]

Oh yeah and as for my debt Its not like I have a lot to show for it except a PSU degree, thats basically it. And as for buying a car and declaring bankrutcy, you do not get to keep the car, its not yours it belongs to the leinholder. I would continue to make payments. The only thing a chapter 11 bankruptcy would clear would be unsecured debt, i.e. credit cards. I'm thinking a honda civic is in my future. i do not want to get into debt again buying an expensive car.

 

[manly]

Originally posted by: notfred
You really think you'd be able to keep the car if you declared bankrutcy? I think I'll go buy a Million dollar house and declare bankruptcy before I make the first payment, I'm sure I can keep it, right?

Well actually there's a loophole specifically for homes in current bankruptcy code. Ask Andrew Fastow about it since (at least a year ago) he was still building a mansion in Houston.

 

[Vic]

Originally posted by: Carbonyl
Go for it.

Chapter 11 and you'll get to keep the car and pay probably around 1/4 of it's value to pay it off. Hell I knew a girl once who made only 33K and her dry cleaning bills were $400 a month and the jude let her keep her new grandam.

Chap 11 BK is for corporations only.
There are only 2 types of BK for individuals:
- Chap 7 - liquidation
- Chap 13 - reorganization and trustee management of finances... oh, I dream that the judge gives you this one... payments to a BK trustee for years and years... they get to decide every piece of your life, even denying vacations or going to the movies.

I bet it'll be Chap 13. Lawyers hate Chap 7 because you could possibly liquidate their fees. Edit: plus that volume of debt without assets to liquidate and then the new car, your creditors will be able to deny a 7. Nope, 13 it'll be for you. Hope you're not planning on buying a house for the next 7-10 years.

 

[psianime]

Your lawyer makes money from doing the papers. I'd say work off your debt. I know people who has declared bankruptcy and that alone prevetned them from most purchasing opportunities.

-psianime

 

[Grminalac]

"Why don't you sell your BMW, move in with your parents and pay your debt off?"

I could, but since I owe more on the car than i would be able to sell it for since i drive a lot at my job, selling the car would basically put me at 4 grand in debt on the car and give me no car. As for moving in with my parents, I don't think it would be right to get a free handout from them either, i would still want to pay fro my fair share, and it would add an extra hour commute and 50 miles to my daily drive.

I don't want to bilk the system, just use the protection of the law to stabilize myself. I just cannot feasibly pay for my college diploma given what I did to acquire it.

 

[Jzero]

Do you have a PhD or something? If you live in-state, PSU ain't THAT expensive.

Here's something to remember: Filing for bankruptcy doesn't teach you doodly-squat about managing your finances and living within your means. You got so deep in debt in the first place because you couldn't figure out how to live within your means.

My suggestions:
Sell your BMW.
Move in with your parents.
Get a second or third job.
Speak to a non-profit credit consellor.
Instead of buying a new freaking car even if it's a freaking Kia, buy a USED FREAKING CAR that you can make SMALL payments on, and don't have to have fully insured!