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How'd you get rid of the $35,000 debt and pay off the loan?
The debt isn't entirely gone. There's between $8,000 - $9,000 left on a personal loan. I'm hoping to have that paid off by next summer. I think I hit "peak debt" back in 9/2016.
My grandparents bought a life insurance policy for me when I was kid that came to maturity. That was $7,000 - $8,000 that went toward the $12,000 - $13,000 in CC debt that I had at my peak. I got that in October or November 2016.
Moved back home and cut expenses to the bone. Paid 1/3 of mortgage and utilities - about $300/month. I didn't go out much. The remaining CC debt and negative car equity were paid off by summer 2017. I bought a cheap used car and drove that until this summer. I had no car payment for close to a year which allowed me to make further progress.
Other than my girlfriend, I really don't have that many friends here anymore. There's much less pressure to go out and have a good time. There are less "events" to spend money on. When I lived in Indy, I had a lot of work friends that I'd go out to nice restaurants, bars, etc. Everyone made pretty good money, but we all spent like drunken sailors, and some of us talked finances.
Sadly enough, my debt level was nowhere nearly as high as some of my colleagues, and it about sank me for awhile. One guy had $100,000 in student debt, and bought a new Mustang and Harley the same year. A woman I worked with there for awhile, who abruptly resigned, contacted me on Facebook later that year, and her and her husband had a combined $55,000 in CC debt.
I still eat out, but definitely try to be mindful of who has cheap drinks and eats. If you go to a bar, you're paying $5/pint for a craft beer not on special, not counting tip. You can get pint of the same stuff for $2 at the same grocery store. Some places here have $1-$2 beer nights during the week. Some places have reasonable food specials.
My biggest flaw is getting involved with women who have no money and going out to eat.
I'm aware of those factors, but they don't seem to hamper, set back, and prevent people who claim bankruptcy from living a good life. The penalties seem minor.
The reason that you only "hear" about people conning the system is that they are the few who have no shame.
For most people, there is a sense of shame about the whole business. It just isn't something they chose to share unless they have to, like a family member suffering from addiction, or marital problems, or anything else. For most people, bankruptcy is brought on by medical events/bills, divorce, or job loss or a combination of the three, and they don't talk about it publicly.
I don't like someone trying to claim disability or string out a workers comp claim or leech the car insurance claiming pain and crippling when they're out rock climbing or declaring BK and skipping away giggling.
But neither do I want to crush people or put those with legitimate need under such suspicion.
I'm just astonished at the high credit limits I have. For convenience's sake, I make $60,000 annually.
I have an AMEX with a $23,000 credit limit. The Discover is somewhere between $13,000 - $15,000. Two Visas have $5,000 each - one has not been used in probably three years. Between them all, I have around $45,000 - $50,000 of available credit with interest rates no less than 17%.
That is a great point. I have one credit card with a $40,000 limit and another with a $36,000 limit. I had to call both banks and tell them to stop raising the credit limit as it was plenty high enough.
I can't believe they would give people this amount of unsecured debt.
Car loans might be a problem, but they're often so low interest that it's not as harmful. My car note is less than 2%. Compared to a credit card or unsecured credit, it's very cheap money.
My biggest issue with car loans is it's become standard to stretch out the loan terms beyond 5 years.
My biggest issue with car loans is it's become standard to stretch out the loan terms beyond 5 years.
Even then, it's not that big of a deal, provided you don't run into cashflow issues. If the payment is low, you can always pay additional during the months you can.
Quote:
Originally Posted by JONOV
The reason that you only "hear" about people conning the system is that they are the few who have no shame.
For most people, there is a sense of shame about the whole business. It just isn't something they chose to share unless they have to, like a family member suffering from addiction, or marital problems, or anything else. For most people, bankruptcy is brought on by medical events/bills, divorce, or job loss or a combination of the three, and they don't talk about it publicly.
I don't like someone trying to claim disability or string out a workers comp claim or leech the car insurance claiming pain and crippling when they're out rock climbing or declaring BK and skipping away giggling.
But neither do I want to crush people or put those with legitimate need under such suspicion.
I only know a few people who've admitted to bankruptcy, even if it was due to medical issues they had no control over. It's a scarlet letter in this society. While I don't think anyone is advocating reckless spending, people need some way to reestablish their lives, and it's not like a credit card companies and the like are going broke as it is.
My biggest issue with car loans is it's become standard to stretch out the loan terms beyond 5 years.
They also last a lot longer (the cars.) Not that that makes it smart, but they last a lot longer, which makes it less of a risk. There's a reason old and high mileage cars don't qualify for the same loans.
Even then, it's not that big of a deal, provided you don't run into cashflow issues. If the payment is low, you can always pay additional during the months you can.
They also last a lot longer (the cars.) Not that that makes it smart, but they last a lot longer, which makes it less of a risk. There's a reason old and high mileage cars don't qualify for the same loans.
Yeah, that's true. But it still doesn't make it ok for me. Back in the day, car loans used to be fore 3 years. I think 5 years is more than long enough.
Nope. Sorry, I don't care about your random anecdote. BK is easily available for corporations and partnerships etc. I don't know what the obsession is with shifting all the responsibility to the individuals with the least resources.
How about the responsibility being with the damn bank that underwrote the credit? they have unlimited resources and made a bad decision. why does the legal system have to be skewed towards favoring them and not the individual?
Consumer rights are being eroded. You can't sue - you have to arbitrate. You can't declare BK, while corporations can do it at will. You have to focus on reading the fine print written by $500 per hour attorneys. Everything is done with the idea of giving more power to large entities and to jam the small guys
Yet, people like you are nodding approvingly under the guise of personal responsibility. But that only applies to the poor individuals.
How about personal responsibility for the loan officer for sucking at his job at underwriting credit? how about personal responsibility for the bank manager for hiring him/her? How about personal responsibility for the bank underwriting crappy business?
How about.....don't get a loan unless you can pay it back (or at least can reasonably expect to do so barring a truly unforeseeable event)?
Personal responsibility applies to all, rich and poor alike. If the lender screws up, then they have to take the loss (except, of course, in cases where they get bailed out by taxpayer money....).
The alternative is for lenders to be super-strict about credit, and unwilling to take any significant risk. This would mean, for example, requiring 20% down payments on a mortgage, no exceptions, and also disallowing a couple from combining incomes to qualify for a mortgage, since they might divorce and not be able to pay the mortgage. Or requiring everyone to show proof of health, short-term and long-term disability insurance to get a loan of any kind (lest the borrower get injured or sick). For that matter, let's force all borrowers to put 6 months of living expenses in an escrow account to get any credit cards or loans. Anybody could lose a job, right?
Ultimately, demanding that lenders mitigate all their risk is a road I don't think most of us would be OK with. Imagine a world where you had to fully document every aspect of your employment history, insurance history, previous residences, family relationships, and medical history going back 7 or 10 years to get a credit card or loan.
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