Question for Bankruptcy Lawyers

[bellasmom]

What is the name of your state? PA
I know some people that have filed for bankruptcy, but I don't know what their circumstances are and don't feel comfortable asking them specific questions about their finances, so I'm going to ask you guys.
What is your opinion of people that run up debt and just can't afford payments anymore, or don't want to tighten the belt to pay off debt? Am I mistaken to think that this is usually the case? I understand that there are circumstances when bankruptcy is the only option as a result of a physical impairment or job loss.

 

[coosi]

What is your opinion of people that run up debt and just can't afford payments anymore, or don't want to tighten the belt to pay off debt?

What is your LEGAL question? This is not an opinion forum...

 

[AttorneyOney]

Actually, there can be many reasons why people find themselves in financial straits and need to file for bankruptcy. As an attorney, I don't judge people -- I try to help them get the relief they're entitled to under the law. The law itself sets the parameters for what all of the people think is reasonable. For example, buying a yacht on your credit card just before filing is considered unreasonable (unless you're a yacht dealer and the purchase is in the ordinary course of business) -- that debt won't be discharged.

Personally, I doubt that very many people decide they "don't want to tighten the belt to pay off debt." The vast majority of personal bankruptcy filers would like nothing better than to be financially solvent, and they choose bankruptcy as a last resort. They have to be talked out of the notion that there is something shameful about it. As a society, we're willing to tolerate abuse by the few in order to give justifiable relief to the many. Bankruptcy and a fresh start seem so obviously better than debtor's prison and homelessness that I almost don't understand why there's a debate about it.

Consider, too, that people often try too hard to pay off their debts. They take out home equity loans (which create nondischargeable liens) to pay off credit card debt (which would otherwise be dischargeable), and end up losing their home. They pay their credit cards instead of their pharmacist. People also sign up for debt consolidation programs that turn out to be scams.

Finally, I think that credit card lenders must bear part of the responsbility for personal bankruptcy because they seem to push credit onto people who have no idea how to use it safely. I might go far as to say that our entire consumer economy depends on people living at or beyond their means, and that ordinary market forces set the level of defaults that the economy will sustain in order for everyone to have the lifestyle they want.

Anyway, to paraphrase Forrest Gump, that's all I've got to say about that. I'd prefer not to get drawn into an extended discussion of this issue.

 

[bigun]

I might go far as to say that our entire consumer economy depends on people living at or beyond their means, and that ordinary market forces set the level of defaults that the economy will sustain in order for everyone to have the lifestyle they want.


I agree. Nearly 2/3's of our $11 trillion economy is composed of goods and services. In other words, people buy stuff. If we all lived below our means and nobody carried credit debt, what do you think the size of the economy would be? How many jobs would be lost and what sort of wage structure would we see in the remaining industry. This economy needs both fiscal saints and sinners to operate efficiently.

 

[bellasmom]

Thank you Oney and Bigun. That definitely gives me a new perspective. Instead of being ticked off at big spenders who may raise prices, I can thank them for boosting the economy.

 

[No choice]

What is the name of your state? PA
I know some people that have filed for bankruptcy, but I don't know what their circumstances are and don't feel comfortable asking them specific questions about their finances, so I'm going to ask you guys.
What is your opinion of people that run up debt and just can't afford payments anymore, or don't want to tighten the belt to pay off debt?

Dear Bellasmom,
The reason you "don't feel comfortable" asking people you know about their finances, is that it's none of your business. Your questions sound very judgmental. Be careful with that - Jesus said:
"Judge not, that ye be not judged. For with what judgment ye judge, ye shall be judged; and with what measure ye mete, it shall be measured to you again."

 

[Buck Barker]

No Choice! The bible study meets every Thursday NEXT DOOR!