Consumer Finance Center – financing

Joseph Devine asked:




The rules of consumer bankruptcy were subject to changes under the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 (BAPCPA). This act resulted in substantial changes to the bankruptcy code. These changes, while they are broad, apply mainly to bankruptcy cases filed on or after October 17, 2005.

The Bankruptcy Code is codified as Title 11 of the United States Code. It has been amended multiple times since its enactment. The code allows for a uniform federal law which governs all bankruptcy cases. This means that it, mostly, does not matter in which state one files for bankruptcy, the rules will be the same.

The procedures for bankruptcy are governed by the Federal Rules of Bankruptcy Procedure. These rules are frequently called the “Bankruptcy Rules”. These rules contain a set of official forms for use in bankruptcy cases. The Code and Rules set out a formal legal procedure for dealing with the debts of individuals of businesses.

A large portion of the bankruptcy process is conducted away from the courthouse. There typically is not much time spent in court. A debtor generally won’t even appear once the process is underway unless there is an objection raised to some part of the arrangement.

Chapter 7

Chapter 7 bankruptcy is known as Liquidation. It is an orderly, court-supervised procedure involving a trustee. The trustee takes over the assets of the debtor’s estate, reduces the assets to cash, and distributes the cash to creditors. The debtor, however, has the right to retain certain exempt properties and the rights of secured creditors.

Generally, there is little non-exempt property in chapter 7 cases. Because of this, there may be little actual liquidation of the debtor’s assets. These are known as “no-asset cases.”

A creditor holding an unsecured claim will get money from the bankruptcy estate only if the case is an asset case and the creditor has filed a proof of claim with the bankruptcy court.

In chapter 7 cases, the debtor will generally receive an immediate discharge of debts.

Chapter 13

Chapter 13 bankruptcy is known as Adjustment of Debts of an Individual with Regular Income. It is specifically designed for a debtor who has a regular source of income, like a job. It is also used for people who do not qualify for chapter 7 bankruptcy due to the means test.

This form of bankruptcy is frequently preferable to chapter 7 because it allows a debtor to keep a valuable asset like a house and because it allows a debtor to repay creditors over time. The time is determined by income and other factors but is generally between 3 and 5 years.

A chapter 13 debtor retains possession of property in the estate and makes payments to creditors, via the trustee, based on the debtor’s anticipated income over the life of the plan. This form of bankruptcy does not allow for an immediate discharge of debts. Instead, the debts are discharged after the debtor completes the payments required under the plan.

Debtors under chapter 13 bankruptcy are protected from lawsuits, garnishments, and other actions by creditors while the plan is in effect. Another benefit is that the discharge is broader under chapter 13 than under chapter 7.

Evelyn

Eric S asked:


I have always been a Democrat, but this Democratic National Convention is honestly one of the weakest campaigns I’ve ever seen in my life. The following questions have yet to be addressed at the DNC:

1) In what ways will Senator Barack Obama will make the most effective leader to carry out and deliver on Democrat policies, on national defense, on the war on terror, as commander-in-chief, etc.
“Who exactly is Obama, what should we know about the presidential candidate that we have not yet learned?”

2) What current policies does Obama specifically want to change (there’s of course good change and bad change)?
-Do you want to raise taxes on the wealthy?

-Do you want government to tax oil profits?

-How do you plan to finance universal healthcare?

-How long do you expect the investments on alternative fuels to
effectively reduce the consumer burden at the pump?

-How will withdrawing from Iraq immediately make America safer?

3) Does the Democratic party back up their campaign statements with fact? For example, Hilary Clinton said that McCain does not believe women should get equal pay for the same work. When did he say this? How did he imply this? We need references.

I’m not saying the Democrats don’t have strong potential arguments, perhaps they have a lot they can discuss!!!!

They just aren’t doing it for some reason. Am I right?
Also a lot of talk about alternatives to gasoline. About solar and hydrogen energy sources. How long will it take till these sources can replace gasoline and the new alternative cars are “affordable”.

This is what the people really want to know. These are serious issues, more important than ideology and making poetry and prose about women’s rights, etc.
LASTLY NAME ONE POLICY THAT IS CURRENTLY WRONG.

Here are just some suggestions:

Capital gains tax should be 20% instead of 15%? -Discuss real estate crisis.

Social Security – Retiring Babyboomers, why not discuss THIS crisis?

Lonnie

Steve A Smith asked:




Consumers are evermore keeping their finances in shape as they look to spending cash in the future, according to the results of a new study.

In research released today by Abbey, an estimated 14 million ’super saving’ Britons are putting cash away for a rainy day. And although such people are doing so in order to make one expensive, large purchase later on in life, this preparation of their money may also help to manage their finances should they encounter an unexpected utility bill or be required to make a payment on a personal loan or other form of borrowing. Overall, these consumers are estimated to have set aside a typical amount of 3,500 pounds – a total of 49 billion pounds.

The research also showed that a luxury holiday is the area on which most consumers are planning on spending their savings as this accounts for 9.8 million – 34 per cent of super savers. Meanwhile, 4.2 million respondents are looking to buy a new car, with 755,000 people (three per cent) aiming on splashing out for their wedding day. Some 3.9 million are also looking to use their money to refurbish their property, with a home improvement loan a possible method of helping to fund such plans. In addition, an estimated 225,000 are set to use their savings to pay for cosmetic surgery.

Commenting on the figures, Reza Attar-Zadeh, head of savings for Abbey, said: “It’s heartening to see that so many Britons are prepared to save up for big ticket purchases, especially as so many young people appear to be doing so. Nothing beats that feeling of being able to splash out on something you have saved long and hard to own. If you’re saving up for a big purchase, it’s important to make your money work for you.”

The financial services provider also highlighted that men are more likely to save for expensive items than women. Four in ten males are looking to put money away, in comparison to some 31 per cent of females. In addition, men are setting aside a typical amount of 3,890 pounds to put towards a major purchase – almost 1,000 pounds above the average of 2,924 pounds being stored up by the opposite sex.

Meanwhile, younger people appear the most financially prepared, as 45 per cent of 18 to 24-year-olds are currently saving up to make a major purchase. Among the over-55s this proportion falls to 22 per cent. And although young consumers are saving less – 963 pounds compared to the 5,740 pounds by older people – their increased propensity to save money may mean they could be in a better position to meet loans repayments as they get older.

For those concerned that they may be unable to set aside enough money to fund making their purchases, taking out a low-rate personal loan may well be an advisable means of supplementing their spending. Earlier this year, findings from Alliance & Leicester revealed that 37 per cent of Britons are set to take out a personal loan to help them buy either a second-hand or a brand new car. Meanwhile, 34 per cent are aiming to use a personal loan as a means of debt consolidation.

Christine

Ken Marlborough asked:




Of the many consumer rights under several different categories, the consumer credit protection act is one of the most powerful privileges you have. It is the most useful tool in your war against credit errors and debt dealings. When used, you can resolve nearly all credit and debt difficulties.

The Consumer Credit Act regulates consumer credit that has contributed much in attaining America’s present financial status. In the U.S, you can purchase anything you want, provided you agree to repay the loan amount with interest. Among the households that hold balances on credit cards, the average amount kept is approximately 2,000 dollars. The amount does not include the added financial burdens of mortgages, rents and car loans. Economists find that Americans owe around 2 trillion dollars in credit card and other debts.

The act’s protections are applicable to contracts between traders and individuals, individual traders, partnerships, and unincorporated organizations. But it does not apply to accords between traders and business bodies such as limited companies. The act has made lots of major changes, including the introduction of rules on credit advertising, the form and content of agreements, the way of computing the APR (annual percentage rate) of the total charge for credit, the extortionate credit bargains, and the formalities to be made in the event of default, termination, or early settlement.

The objective of the Consumer Credit Act is to protect consumers from possible exceptionable practices. It also guards them from ineptitude on the part of those who give credit on a commercial or professional basis. Many consumers make mistakes and are ignorant of what privileges they have to ensure that those mistakes are corrected. The consumer credit laws are little good if you don’t employ them. The laws require that each dealer who makes regulated contracts should hold a license given by the office of fair trading. Debt advisors, credit brokers, and others are also needed to keep licenses.

Herman

Uncle Sam Rothschilds asked:


The real economy contracting rapidly

Behind the reassuring statements from Paulson and others that the “worst is over” the reality of the credit collapse since August 2007 is a deepening economic contraction which I have said several times in this space will surpass the Great Depression of the 1929-1938 period. A good friend who is an unemployed homebuilder in a prosperous part of Arizona just sent me the following list of US department retail store closures. It is worth noting that over 70% of the US GDP is consumer spending and that the entire Federal Reserve strategy of Alan Greenspan after the March 2000 collapse of the stock market bubble, was to bring US interest rates to their lowest levels since the 1930’s in order to stimulate consumer spending on credit, i.e. debt, to avoid “recession.” Note the scale of the following store closings across America in recent weeks:

Ann Taylor closing 117 stores nationwide.
Eddie Bauer to close more stores after closing 27 stores in the first quarter.
Cache, a women’s retailer is closing 20 to 23 stores this year.
Lane Bryant, Fashion Bug, Catherines closing 150 stores nationwide
Talbots, J. Jill closing stores. Talbots will close all 78 of its kids and men’s stores plus another 22 underperforming stores. The 22 stores will be a mix of Talbots women’s and J. Jill.
Gap Inc. closing 85 stores
Foot Locker to close 140 stores
Wickes Furniture is going out of business and closing all of its stores. The 37-year-old retailer that targets middle-income customers, filed for bankruptcy protection last month.
Levitz – the furniture retailer, announced it was going out of business and closing all 76 of its stores in December. The retailer dates back to 1910.
Zales, Piercing Pagoda plans to close 82 stores by July 31 followed by closing another 23 underperforming stores.
Disney Store owner has the right to close 98 stores.
Home Depot store closings 15 of them amid a slumping US economy and housing market. The move will affect 1,300 employees. It is the first time the world’s largest home improvement store chain has ever closed a flagship store.
CompUSA (CLOSED).
Macy’s – 9 stores closed
Movie Gallery ­ video rental company plans to close 400 of 3,500 Movie Gallery
and Hollywood Video stores in addition to the 520 locations the video rental
chain closed last fall as part of bankruptcy.
Pacific Sunwear – 153 Demo stores closing
Pep Boys – 33 stores of auto parts supplier closing
Sprint Nextel – 125 retail locations to close with 4,000 employees following 5,000 layoffs last year.
J. C. Penney, Lowe’s and Office Depot are all scaling back
Ethan Allen Interiors: plans to close 12 of 300 stores to cut costs.
Wilsons the Leather Experts ­ closing 158 stores
Bombay Company: to close all 384 U.S.-based Bombay Company stores.
KB Toys closing 356 stores around the United States as part of its bankruptcy reorganization.
Dillard’s Inc. will close another six stores this year.

For anyone familiar with American shopping malls and retailing, this represents a staggering part of the daily economic life of the nation, from furniture stores to clothing to video rentals to leather. The process has only begun and neither major party Presidential candidate has dared to mention this on the ground economic reality, because they evidently have no solutions to offer that would not jeopardize their campaign finances. Obama is tied to not only Pritzker but also to Omaha billionaire, Warren Buffett and George Soros. McCain depends on the traditional money contributions of the Republican Party which demand permanent tax reform for highest income earners and a pro-bank laissez faire treatment of millions of homeowners facing home foreclosure and asset seizure by banks.

Georgia

StephenWeinstein asked:


The computer says:

“Why Is My Score 828?

1. The time since your most recent account opening is very recent

Research shows that consumers who have recently opened new credit accounts are slightly more likely to miss payments than those who have not. This is not an especially strong risk factor, and therefore usually means a difference of no more than a few points in a consumer’s FICO score.

2. There is a lack of recent (non-mortgage) installment loan information being reported on your credit file

Demonstrating that you can manage a variety of different types of credit responsibly is a behavior the score evaluates. In particular, the score may examine your repayment behavior on some types of personal loans (but usually, not including mortgage or other big ticket loans, which are examined in other ways). Having no personal loan accounts appearing on the credit bureau report, or if they are present but are closed or are no longer being reported by the lender, is a slightly higher risk compared to currently having an installment loan and making payments on it. The score evaluates the types of credit in your credit history, and considers your mix of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans. It isn’t necessary to have one of each, and it’s not a good idea to open credit accounts you don’t really need, or don’t intend to use. ”

If item 1 “means a difference of no more than a few points” and “it’s not a good idea” to do anything about item 2, what can or should I be doing?

John

Mark Dawson asked:




With constraints on their finances predicted to rise over the coming weeks, consumers could be well advised to make sure that their monetary situation is in sufficient shape to cope with an increase in payments, an industry expert has asserted.

The warning comes as Keith Greening, debt adviser at the Dorchester branch of Citizens Advice, told the Dorset Echo that an ever-increasing number of people in the area are struggling to manage their money and keep on top of demands for payment on areas such as utility bills and home loans. Mr Greening also stated that the expensive cost of renting property in the region is contributing to the rising proportion of those developing financial difficulties.

Meanwhile, the office has reported a general rise in the numbers of those seeking advice, which could include guidance on handling their finances such as paying off loans. In the year leading up to March, some 11,332 people from Dorchester and surrounding areas visited the bureau, an increase from the 10,662 noted during the previous 12-month period. Overall, consumers going to the Citizens Advice branch last year were more than 5 million pounds in the red.

The rise in debt difficulties was partially attributed to older consumers in the area struggling to manage their finances in the wake of rising utility costs. He said: “There seem to be a lot of older people coming through our doors. They are often on a fixed pension income and are finding bills are rising. Utilities such as gas and electricity have risen sharply recently. Some older people are having to use credit cards and can’t make the repayments.”

In addition, he asserted that those most affected by their inability to service their debts are typically on a low income and have had a history of credit problems. In turn opting for a bad credit loan could be a possible option for consumers looking to get back on their financial feet. Mr Greening added: “The big rush for debt advice comes after Christmas. Quite simply, people should not spend money that they haven’t got. I know it’s tempting but hold back and have a debt-free new year.”

However, he stated that with a number of Britons due to witness a rise in mortgage repayments, consumers could begin to see pressures on their day-to-day spending increasing. Meanwhile, the effects of the US sub-prime slide and the financial difficulties witnessed by Northern Rock are predicted to consequently see lenders become stricter with prospective borrowers’ applications for secured loans and other forms of credit.

As a result, those who are concerned that pressure on their spending is to increase may wish to take out a low-rate loan as a means of paying of money owed to various creditors quickly. However, borrowers worried that previous financial difficulties might impair their access to competitively-priced borrowing, yet who are confident that they will be able to afford making repayments, could be advised to opt for a bad credit loan. Earlier this year, research from Datamonitor revealed that as the nation’s debt difficulties rise more consumers will look to a bad credit loan as a means of getting back on their financial feet.

Henry