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Old 10-13-2011, 08:26 AM
 
Location: NJ
18,677 posts, read 17,033,468 times
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mb1547"If you purchase products or services, and you don't pay for them, who do you think has to eat the cost? It's the business that you bought them from, and it can be devastating to them"

I agree. Do you always sign personal guarantees to insure businesses you purchase from need not fear ever eating the costs? I like consistency, and view Business BK ever bit as unfavorably as personal BK.
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Old 10-13-2011, 08:27 AM
 
3,458 posts, read 3,105,750 times
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Declaring bankruptcy over credit extended for consumption purposes (houses, cars, electronics, etc.) is worse than living off welfare.

Declaring bankruptcy over credit extended for legitimate business production purposes is not so bad.

Declaring bankruptcy to rid yourself of business losses, while hiding other assets that you will resume ownership over after bankruptcy, is downright evil.
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Old 10-13-2011, 08:29 AM
 
523 posts, read 381,587 times
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bring back debtors' prison!!!
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Old 10-13-2011, 08:29 AM
 
Location: NJ
18,677 posts, read 17,033,468 times
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Cletus, Agree with point 1, vehemently disagree with point 2.
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Old 10-13-2011, 08:33 AM
 
3,458 posts, read 3,105,750 times
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Quote:
Originally Posted by bobtn View Post
Cletus, Agree with point 1, vehemently disagree with point 2.
can you be more specific?
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Old 10-13-2011, 08:39 AM
 
11,960 posts, read 17,460,982 times
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Quote:
Originally Posted by andrea3821 View Post
No, I'm strictly talking about personal.

The reason I ask is because someone I know is considering filing but made a comment about how it makes him feel like he is just as bad as the welfare folk. I don't see it that way at all. He is very conservative like me so it kind of caught me offguard for the reasons I mentioned above. I don't think it would be that bad to file since I see it like a business decision, esp when it comes to paying on a house that is deeply underwater or cars that are upside-down. I'm more torn on credit card debt if it was all for the sake of just having "stuff."
Well, that is the problem. I know of three people in my office who filed in the past. All did so because they bought tons of stuff. I find that disgraceful and akin to (lifelong) welfare.

The law has been tightened and it is no longer so easy to file for personal bankruptcy and simply erase the debt.

Now, there are of course people, and business for that matter, who fall on hard times and simply need the breathing room to regroup, replan, and then rebound. Medical expenses or caring for sick or elderly relatives might be causes.

Like with most things, it depends.
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Old 10-13-2011, 08:47 AM
 
Location: NJ
18,677 posts, read 17,033,468 times
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Cletus, Too many small businessmen try to live lifestyles they cannot afford, just as non businessmen do. They intermingle finances, take unsustainable salaries from their "business", and when they do so, they are acting just like the consumers living it up you disdain. In addition, a primary reason many businesses fail is business-to-business bad debt/BK. So allowing the "out" of a business BK is, in many ways, even more harmful than individual BK.

Quite frankly, no one has any business starting a business who cannot afford a LESSER salary than they enjoyed as an employee for a lengthy period of time. To draw a bigger salary too often is cutting the throat of a fellow businessman. That is why I favor personal guarantees 100% of the time for several years, as it doesn't allow for such foolishness w/o a cost to the debtor.
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Old 10-13-2011, 08:48 AM
 
Location: Londonderry, NH
41,505 posts, read 51,280,422 times
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I have been broke but never bankrupted. I had a business fail but I closed it without stiffing any of my suppliers or failing to pay my mortgage. We had some hard times but worked our way out. If I had a serious illness during that period we would have had to consider bankruptcy.

Bankruptcy is a way of giving a person or a business a second chance. It is just a risk of doing business for the creditors. Properly administered the scam artists would be charged with fraud and prosecuted.
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Old 10-13-2011, 08:52 AM
 
Location: NJ
18,677 posts, read 17,033,468 times
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GregW:"I had a business fail but I closed it without stiffing any of my suppliers "

Excellent!
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Old 10-13-2011, 09:08 AM
 
10,115 posts, read 6,980,852 times
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Quote:
Originally Posted by bobtn View Post
mb1547"If you purchase products or services, and you don't pay for them, who do you think has to eat the cost? It's the business that you bought them from, and it can be devastating to them"

I agree. Do you always sign personal guarantees to insure businesses you purchase from need not fear ever eating the costs? I like consistency, and view Business BK ever bit as unfavorably as personal BK.
I don't, but I don't have huge supply/inventory costs--my biggest cost is labor, and I charge enough up front before services to cover the cost to my outside suppliers at the time of service, or for big jobs they prepay with a deposit. I'm stuck paying my employees on my own in the event that I'm not paid for the rest of it (and it's happened), but so far I've been able to sqeak by and cover everything. If I ever got to the point where I couldn't pay them, you can be sure that I'd pay them out of my own pocket vs. the business. My line of credit with the bank is secured.

It's a good idea. I'd sell my house before I'd stiff my staff or my suppliers.
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