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Bankruptcy in the US

Bankruptcy in the US

Old Dec 1st 2019, 5:09 am
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Default Bankruptcy in the US

Originally Posted by Indi129 View Post
I know credit card debt doesn’t follow you across the pond but does anyone know if this applies to personal loans from a small US only bank?
If the debt is a sizable amount have you considered wiping it out with a bankruptcy? That would give you a fresh start and peace of mind that the debt is dead. Just remember you can't include student loan debt in bankruptcy. A bankruptcy usually cost about $1000. A chapter 7 can make sense if you aren't able to pay back your debt and if you don't have any real assets(home, bank accounts ect depending on the state you live in. In Florida you can go chapter 7 despite owning a home and car. I know a person that owns a four million dollar home and was able to wipe out all his debt. Hope this helps.
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Old Dec 1st 2019, 12:55 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by UkWinds5353 View Post
If the debt is a sizable amount have you considered wiping it out with a bankruptcy? That would give you a fresh start and peace of mind that the debt is dead. Just remember you can't include student loan debt in bankruptcy. A bankruptcy usually cost about $1000. A chapter 7 can make sense if you aren't able to pay back your debt and if you don't have any real assets(home, bank accounts ect depending on the state you live in. In Florida you can go chapter 7 despite owning a home and car. I know a person that owns a four million dollar home and was able to wipe out all his debt. Hope this helps.
The OP is talking about a UK debt...not US. The OP should note that the above refers to the US not UK.

UK folk do not jump into bankruptcy like Americans do.
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Old Dec 1st 2019, 1:17 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by UkWinds5353 View Post
I know a person that owns a four million dollar home and was able to wipe out all his debt.
Why wasn't he made to sell his home and get a cheaper one, so that some of his creditors could be paid something? Or even better, voluntarily do that as a matter of morality? That's one seriously f'd up law that allows that.
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Old Dec 1st 2019, 1:25 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by spouse of scouse View Post
Why wasn't he made to sell his home and get a cheaper one, so that some of his creditors could be paid something? Or even better, voluntarily do that as a matter of morality? That's one seriously f'd up law that allows that.
Americans seem to declare bankruptcy at the drop of a hat...that is one of the reasons why they do.
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Old Dec 1st 2019, 2:38 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by spouse of scouse View Post
Why wasn't he made to sell his home and get a cheaper one, so that some of his creditors could be paid something? Or even better, voluntarily do that as a matter of morality? That's one seriously f'd up law that allows that.
The United States is a country that was established from the very beginning of our Union with every individual state having the legal right to decide it's own laws up to a point, providing those laws don't trump federal laws. Example, New Jersey has the right to set up Casinos and allow legal gambling even if the neighboring state has in place laws that police the behavior of their citizens. Maybe that state's majority population voted to protect it's citizens from acts or behavior that they consider not acceptable.

Florida is the only state in America where if you fall on hard times and lose your source of income, and own your home outright you do not lose the dwelling you reside in if forced into bankruptcy. That law would not protect any additional bank accounts or property you might own. You're also allowed to retain one vehicle but with stipulations. If the home you live in is valued at fifty million dollars that home is still protected under the Florida bankruptcy laws.

The associate I know lost his company but because he resides in Florida his home was not touched. But keep in mind that in all fifty states most pension plans are exempt from seizure. Not surprisingly a lot of millionaires live in Florida. Also keep in mind that Florida's bankruptcy laws pertain to a dwelling lived in but paid for with legal funds. You can't build wealth by illegal means and have that paid off property protected by law.

Last edited by UkWinds5353; Dec 1st 2019 at 2:48 pm.
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Old Dec 1st 2019, 2:45 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by Jerseygirl View Post
Americans seem to declare bankruptcy at the drop of a hat...that is one of the reasons why they do.
It use to be worse about 15 years ago when the laws allowed a individual to go BK more frequently. Now if a person gets in trouble they have the legal right to correct their course of ship once in ten years. It use to be every seven years. Not surprisingly companies don't have those limitations placed on them.
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Old Dec 1st 2019, 2:49 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by UkWinds5353 View Post
The United States is a country that was established from the very beginning of our Union with every individual state having the legal right to decide it's own laws up to a point, providing those laws don't trump federal laws. Example, New Jersey has the right to set up Casinos and allow legal gambling even if the neighboring state has in place laws that police the behavior of their citizens. Maybe that state's majority population voted to protect it's citizens from acts or behavior that they consider not acceptable.

Florida is the only state in America where if you fall on hard times and lose your source of income, and own your home outright you do not lose the dwelling you reside in if forced into bankruptcy. That law would not protect any additional bank accounts or property you might own. You're also allowed to retain one vehicle but with stipulations. If the home you live in is valued at fifty million dollars that home is still protected under the Florida bankruptcy laws.

The associate I know lost his company but because he resides in Florida his home was not touched. But keep in mind that in all fifty states most pension plans are exempt from seizure. Not surprising a lot of millionaires live in Florida. Also keep in mind that Florida's bankruptcy laws pertain to a dwelling lived in but paid for with legal funds. You can't build wealth by illegal means and have that paid off property protected by law.
I understand that different states have different laws, and no one should be left homeless through bankruptcy, but I maintain that someone like this being able to wriggle out of paying their debts to others, who quite conceivably don't enjoy the luxury of a 4 million dollar home, is dead wrong and immoral. The law certainly is sometimes an ass.
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Old Dec 1st 2019, 3:33 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by spouse of scouse View Post
I understand that different states have different laws, and no one should be left homeless through bankruptcy, but I maintain that someone like this being able to wriggle out of paying their debts to others, who quite conceivably don't enjoy the luxury of a 4 million dollar home, is dead wrong and immoral. The law certainly is sometimes an ass.
I couldn't agree more about the morality issue. But the good people of Florida has decided they want this particular bankruptcy rule to remain the law of the land as a added protection. And it has been looked at several times by previous Governors. My associate is playing by the rules that govern the State. But every country has it's share of interesting laws.

Last edited by UkWinds5353; Dec 1st 2019 at 4:07 pm.
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Old Dec 1st 2019, 3:35 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by UkWinds5353 View Post
I couldn't agree more about the morality issue. But the good people of Florida has decided they want this particular bankruptcy rule to remain the law of the land as a added protection.
Well I guess it protects some people.
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Old Dec 1st 2019, 4:32 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by spouse of scouse View Post
Well I guess it protects some people.
It protected his four million dollar home. But he is not the only one. There are people from various parts of the world that buy property in Florida knowing full well about the bankruptcy laws including Aussies and Brits. But that's the way of the world, using the rules in their favor but not breaking the law. And if you focus solely on doing everything by a moral standard as a business person you'd be out of business. You have to be tough while conducting your business model. If you work for a company for thirty years giving your blood sweat and time, and they one day decide to fire you at the age of 57, because they want to save money, that would be immoral and dishonorable. But companies put profit ahead of people all the time. And I would tell anyone it would be foolish not to use the system and laws to protect you and your family. So I can't blame my associate for protecting his best interest. He would be a idiot had he not.
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Old Dec 1st 2019, 4:43 pm
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Default Re: Moving to U.K. from USA with existing loans?

Originally Posted by UkWinds5353 View Post
It protected his four million dollar home.
. So I can't blame my associate for protecting his best interest. He would be a idiot had he not.
I know the law protected his 4 million dollar home, but it didn't protect the people who he owed money to.
It's not my place to blame or not blame individuals, who are quite entitled to act within the law and their own consciences. I can and do comment on laws that I believe are unfair, both in my home country and in others.
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Old Dec 1st 2019, 7:40 pm
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Default Re: Bankruptcy in the US

Companies use bankruptcy as well, nearly every US airline filed for bankruptcy at some point between 2001 and 2011, mostly to rid themselves of debt accrued due to 9/11 and legacy pay and benefits to employees, and force creditors into renegotiating debt, getting out of aircraft leases etc as one example of corporate restructuring bankruptcies.

I do agree if one owns a modest home they should be able to keep it if they go bankrupt, but if someone is living in a home worth millions, they should be forced to sell it and downsize.

Look how many times Trump or his companies have gone bankrupt.

I went bankrupt once, but I had no bank loans or credit card debt, no debt at all, just happened to get sick and had a crappy insurance company who decided they were not going pay the bill.

Lenders in a way are part of the problem, it was maybe 6 months after my discharge that I would get 3+ a day sometimes from various lenders with various offers, mostly from car dealers, but a few from shady mortgage places. Almost seemed in a way it was easier to get credit after bankruptcy than before.

I opted for a secured credit card using my savings account as collateral.
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