The Case for Walking Away

I just want someone to explain to me why we should give billions possibly trillions to the banking and other industries when there has been little to no discussion about what they will do to help people repay these loans in reasonable time frames or help them stay in their homes or keep their jobs. Why should we give our tax dollars that could be used to pay off debt to companies that are unwilling to work with us and help us repay the debt we already owe due in part to their legal meanderings?

When banks start offering ideas on how to fix the mess that they are partially responsible for creating, I'll be more than happy to sit down at the table with them. All contracts have consideration: there is a meeting of the minds of what is offered in exchange for some service or good. Banks encouraged everyone to borrow. No one forced a bank to loan anyone money that was unsecured. Make the banks work with us and become part of the solution rather than wanting to have all their losses covered while still expecting us to keep paying them after they write off and recoup their money via a bail out paid by taxes of some of the very people they took advantage of.

I see so much in this dialog about how debtors should stop acting like victims but can no one see the banks are doing exactly that ??? acting like victims in front of Congress? If a bank loaned the money, then it should expect defaults and bankruptcies if they can't work it out with the borrowers who were good enough for the loans when they handed them the money.

I am confused, sick and thoroughly digusted. The current generation has grown up believing that they do not need to be responsible. When will Americans begin to take responsibility for them selves?
I grew up with my grandparents who were products of the depression, and escaped the Nazis.nThey tought me to live within my means because you never know.

There was no bail out when I graduated from college in 1981 and job opportunities were limitted. I lived at home untill I could afford a 20 % down payment and a 12% mortgage, and pay our student loans. We didn't go out, travel, own a computer, or have cable TV. We got use to being cheap, and saved some of our income. I was taught it was nuevo riche to live beyond your means.

We bought our 2nd house on black monday, and were faced with unemployment shorty thereafter. I took a job that paid 1/2 my old one, drained our savings and 401K, paid our bills. Never contemplated filing bankruptcy. We didn'tlook at the current value of our hame each month when deciding if it was a good idea to pay our bills.

We moved up to our current house in 2000- just before the dot com bubbble burst. Home value depreciated once again. Unemployment (twice since then) did't prevent us from paying our bills. You see- we didn't buy thing we couldn't afford.

So why am I disgusted?
The government did not bail out wall street- They bailed out a financial system that was overleveraged.
The Big Three weren't bailed out- the UAW was.
There is more pork in the bailout programs then the country can afford- and the pork keeps on comming.

I just can't wait for the double digit inflation ( what aolways happens after you flood the market with money) Higher unemployment and Higher interest rates and higher taxes.

First, the housing crisis was caused by Congress making credit to easily available with products that were in essence fraudulent. Anyone could get a no-doc loan. It is not a great idea for a bank not to know if they can be repaid. This led to much more demand than supply, thus inflating home values unrealistically.

Second, for those who are in deep, but maybe not too deep, you might not have to declare bankruptcy. I am not proud of this, but I had to finance a nasty custody fight against an ex-wife from hell. Sorry, but I would fight for my child, and screw any company I had to along the way.

I had about $26,000 in credit card debt: $11k, $8k, and 7k. In my state, there is a statue of limitations on unsecured loans of 3 years. Most companies will not file suit within that period for such low sums. Chance are also with so many people in trouble now, the values are also much higher now before they will go after you. I recently got a call from a collection agency demanding payment. I am barely afloat right now, so I told him that I no longer owed the money under the law.

After a little berating, and lies about how it was 7 years (that is just how long it will be on my credit report, and that does not change), I told him he was wrong and reiterated that I did not owe the money. They had to have sued within three years, not just think about it, so I told them to go ahead and sue. I have not received a call since.

The point is that if your problem is credit cards; your credit is already ruined, so why file for bankruptcy when you already may not owe the money?

http://www.creditinfocenter.com/rebuild/statuteLimitations.shtml

Why do we not go back to the old bankrupty laws that were in place for years? They helped all people get a fresh start, the credit card companies have been cheating and stealing from us long enough! They can raise interest rates to unheard of amounts and getting by with it!! And the gov. gives the banks money and they keep stealing from the consumers that were trapped by them in the first place.

I am not so sure that is the way? Why do they not go back to the old bankrupty laws that were final debt free with the country in so much trouble??? Also why are the credit cards allowed to charge such high % rates. It is cheating in every sense of the word>

Chumps by the Dozen should be thanked for being so honest. I have watched dozens of people pay $200-500,000 for homes worth half that value. It has been awful watching these people fall into this pitfall.

I was bankrupted going on 15 years ago now, after a hate crime that left me doing the proverbial robbing Peter to pay Paul. While I do not wish it on my worst enemy, for those of us who have a deeplyn ingrained work ethic and had spent 30+ years working and being financially responsible it was the best way to start over with my family and my health and sanity intact. I do feel very sorry for those whose lives were adversly affected by the economic downturn and even though I do not want to sound trite it is after all just money. After almost 400 years in this country I have 1 photo alblum to show for my and my family's work and lives here, and even that's spotty at best. The good news is also that after the required 7+ year time period and changing careers (I do not make a lot of money now) I have my credit restored and once I get a down payment can buy another home, and rebuild my shattered life. I agree therefore, that if you see the handwriting on the wall, don't jump but do seriously consider bankruptcy, so you and your family can remain healthy and sane.

Laffalltheway .. I don't know where you get your misinformation but NH is NOT NOT upper middle class white and all the other INCORRECT biggotted statements you made.. I have lived in NH for over 30 yrs. I do not have a college education as my blue collar parents couldn't afford one and being classed as middlle class I didn't qualify for financial assistance of ANY kind. Part of my debt is I pay out of my pocket for my children's college education. So no Ivy league school, BTW NH doesn't have an Ivy league school .. that is Massachusetts.. It's a community college for my children. I pay over 10k in Federal tax yet my children don't qualify for Federal programs because since I was 17 I have worked my butt off to better myself.

You really need to learn your demographics and not post out of such ignorance. My hard earned money goes to pay for folks who have run into tough times and for slackerds, illegals, and wealthy who can afford the loopholes. I'm a single parent and have ALWAYS paid my taxes and my own expenses. I'm part Native American and white and I live in NH.
And I'm at a point where bankruptcy might be my only recourse for survival. No rich parents or external source of income to bail me out.

I am tempted to file for bankruptcy but the moral side of me says to tighten up the spending and develop a reasonable plan to get out of debt. BUT! What do do about my student loans? That is the biggest nightmare of my life, it's a black cloud that will not go away. I will be 80 years old and still paying on this loan. Why is there no help out there for us who are struggling with this mess?

I have a few questions please?? First a bit of history regarding my foreclosure.
Two and a half years ago (June 2006) I was involved in an accident. A propane tank self ignited and I happen to be within two feet of it. Needless to say I spent the next 6 months in rehab, and another 6 months unable to work. I am self employed and could not afford the medical bills so in the end my wife and I lost our house to foreclosure. I tried a Chapter 13 only because I had hoped to work out a payment program. In the end it (the house) was lost. Having owned our home for 17 years it was a hard thing to accept. We are currently renting, both of us are mid forty. We never went through the Chapter 13 since our Lawyer recommended that we should at this point file for Chapter 7 Bankruptcy which would wipe out all medical bills as well. What would be recommended?
Go through a Chapter 7 or simply wait it out and hopefully reapply for a mortgage when the time is right??
That brings me to my other question? At what point in time would the banks/lenders consider me a good risk and agree to a mortgage loan???

All those items you are talking about are the american way of life pushed on us by every bit of hype they can muster on tv. The underlying part is in the end, you have the rich superrich and the poor. That's where we are heaeded unless some real action is taken to help generate new jobs that are worth working and reevealuate ALL situations not just the big 3 car companies and the banks. THERE MUST BE MONEY FLOWING INTO ALL POCKETS IN ORDER TO STABILIZE THIS COUNTRY. IF THE REEVALUATIONS OF ALL CREDIT AND REVAMPIMG IN FAVOR OF ALL DOESN'T HAPPEN ,WE WILL SEE THE NEXT DEPRESSION AS SURE AS I'M WRITING THIS ARTICLE. WORRYING ABOUT WHO HAS THE BIGGEST AND BEST OF ANYTHING DOESN'T HAVE ANY MERIT. THIS IS VERY,VERY, SERIOUS SITUATION.AND IN ADDITION, TELLING PEOPLE TO PAY THEIR BILLS IN THIS ECONOMY WHEN THEY HAVE NO JOB AND CAN'T GET ONE IS VERY UNREALISTIC. THEY AREN'T DEADBEATS,THEY BEEN CONNED BY THE EXPERTS.

How about instead of publishing an article that is about people escaping debts that they probably knew they were cutting close to affording to begin with, we write articles about taking jobs that we otherwise wouldnt to pay back debts that we shouldnt have responsibly accepted to begin with? Or picking up a second job for those that still have a first?
With the economy as it is, filing bankruptsy by the masses is going to do nothing more than penalize the people who get hurt the most by these fiascos -- the people who are responsible, manage their lives with little debt and pay back their debts as they intended.
If someone is without work, why not tell them to take a lower paying job to get by. Flip a burger or work retail, some thing, any thing, to get by.
I frankily am tired of protecting my credit, my home, my finances, by working hard for what I have while I see so many other people, trying times or not, sitting back, collecting unemployment or government benefits or using systems like bankruptsy as scape-goat defenses. What ever happened to paying in full for what you owe? Im tired of others essentially 'stealing' by loopholes in systems and leaving all of us responsible people out here who dont bite off more than they can chew paying inflated rates because business is loosing money by dead beats. Like you said, credit card companies charge 'elephant fees because they know not every one can/will pay'... there's a problem with that being OK and accepting that as a norm.
I am also tired of hearing excuses. The government cant afford to pay for us all and I certainly cant afford to continue to make up for every one elses short falls.
Now, I feel for people who have lost jobs and arent able to find new ones, who were truly savvy with their money prior to the floor falling out underneath them, this I understand. But for the majority, they look for some one else to bail them out. When will the bailing out stop? I think we should reward responsibility, not punish us for irresponsible people's screw-ups. What are we teaching our kids.... dont worry if you can afford it, you can use it until the newness wears off and then when you are tired of paying or cant pay, someone else will be there to bail you out.
Im just appauled that msn.com would publish an article suggesting that we honor bankruptsy and consider it as a 2009 resolution. We need to be coaching people on financial responsibility, like saving up for what we want vs. buying it now because thats what we want.
Id appreciate an article about becoming financially money wise. How to cut costs, pay off debts, and manage money today and planning ahead for the unexpecteds. Our grandparents had to do that, so why shouldnt we all now?

how many years do you have to wait before you file bankruptcy again?

okay but how long do you have to wait if you filled already a couple of years ago?

This is the lamest article I have read in a long time. Lets all take our lives back by committing fraud against those who we think defrauded us. I guess in the U.S., two wrongs make a right. Lets use our credit cards and charge things with no intention of paying it back since we can just declare bankruptcy! All you geniuses out there know that once that starts happening, Bankruptcy laws will be reformed just like they were a few years ago, to make it harder for those who really need to use the tools to help them get a fresh start. Finally, for all those that blame big business, who signed the mortgage? who was buying way over their pay grade on credit? Who was living in the now instead of waiting for the right time or saving and living frugally. Seriously folks, We The People are to blame. America is greedy and now we are paying for it. Suck it up and be honorable and stop lying to yourselves about whose fault it is. Its everyone together. So lets fix it together, and stop trying to keep getting what we can for ourselves.

What she's saying is that if the 60" big screen TV blue ray disc player, fluffies bi-weekly visits to the doggie spa and the 3 beemers sitting in the McMansions garage is too much of a burden, just unload it on everyone else. Disgusting. Pay your bills, carry your weight in this society.


Al.