Bankruptcy Resource Group

March 31, 2009

Personal Bankruptcy: Who To Blame?

Filed under: Uncategorized — C.Welch @ 5:37 am

2535502341_8aac3df9fb_mBankruptcy Survivor has been reporting on increased bankruptcy rates across the United States, especially in California and our home state, Oregon. But the financial worries are not limited to these United States.  Many of our neighbors to the north are also struggling to stay on top of bills.  According to Canada’s Globe and Mail, 8,000 Canadians filed for personal bankruptcy in January of this year, a 21.7% increase from the same time last year.  

Credit Canada, a non-profit organization dedicated to helping people in extreme financial difficulty, reports a 40% increase in phone calls from consumers seeking aid.  

In other words, many Canucks are in dire need of help.  Many of them are turning to bankruptcy for a second chance.  As I was raised Catholic, I found it especially amusing that Globe and Mail writer Sarah Hampson compared personal bankruptcy to Easter.  She writes, “Personal bankruptcy is like Easter, if you listen to those who might sell you on its merits. It’s an unfortunate financial death, followed by Resurrection.”

If you’re a Bankruptcy Survivor yourself, you’ve probably already spent nights wondering who should take the blame for personal bankruptcy.  In these times of economic crisis, some would blame bankrupt consumers for foolishly taking out more credit than they could afford.

Others, like Margaret Johnson, the president of Solutions Credit Counselling Service in BC, say the credit industry is to blame.  Ms. Johnson said, ”The credit industry holds the key to this. They could slow or stop the bankruptcies by being easier to get along with.  In cases that threaten personal bankruptcy, Ms. Johnson wonders why the credit agencies don’t do more to help overstretched customers.  ”Why not reduce the interest or forgive the interest or whatever we need to do to get this person back on their feet and retain them as a customer instead of throwing them to the wolves?”  she says.

Furthermore, many consumers were uninformed when they signed up for easy credit cards.  Too many credit companies glossed over details like booming interest rates down the line.  

What are your thoughts on this?  Who should take the blame for the current glut of bankruptcies?

If you’re through a bankruptcy, and looking for ways to rebuild your credit, give Bankruptcy Resource Group a call.  They maintain a nationwide network of car dealers who specialize in providing credit to post-bankruptcy consumers.  Making regular (or even early!) car payments is a great way to rebuild your credit after a bankruptcy.

Top photo by Howard Gees.

March 23, 2009

California’s Bankruptcy Boom

Filed under: Uncategorized — C.Welch @ 5:56 am

The economy’s crash is being felt differently in different parts of the country.  Here in Oregon, we’re steadying ourselves for a second round of foreclosures from homeowners who took out “Alt A” type mortgages, which threaten ballooning payments as the mortgage ages.   Still, Oregon’s situation seems less dire compared to other states– like California.

Many California residents are filing for bankruptcy after struggling to make ends meet. The Modesto Bee recently reported that bankruptcy filings have increased 83% since 2007 in and around the Central Valley cities of Fresno, Modesto, and Sacramento. In part, California’s 89% increase in jobless claims has fueled the rise in bankruptcies.

Other factors often contribute to bankruptcies, as the editorial staff of the Modesto Bee recently noted: “The downward spiral often begins with residents becoming overextended on credit card debt, then breadwinners lose their jobs and mortgage payments mount and foreclosure begins. Once that occurs, many residents see bankruptcy as their only way out.”

Fortunately, after the hassle of bankruptcy is over, it is possible to rebuild credit.  Here’s hoping all of California’s recent bankruptcy filers will become strong, vibrant Bankruptcy Survivors, who have seen the other side of bankruptcy and carefully rebuilt their credit scores.  One way to improve your credit score after a bankruptcy is to take out a new car loan.  If this solution appeals to you, give Bankruptcy Resource Group a call.  BRG maintains a nationwide network of auto dealers who specialize in lending to Bankruptcy Survivors like you.

Top photo by Woodley Wonderworks.

March 20, 2009

News Review: Proposed Bill Would Fund Financial Responsibility Education

Filed under: Family Finances, Financial News, Politics, Rebuilding Credit, Uncategorized — Tags: , , , — C.Welch @ 5:29 am

Here’s hoping the next generation will be wiser with money.  Many of today’s young Americans have credit problems– a fact that no one really worried about until now, when unemployment is on the rise.  Before the recession hit, it seemed like everyone benefited from easy credit– the manufacturers were happy to make money, and the consumers were happy to spend it. Only now is it becoming clear just how many consumers are drowning in debt.

High school students are among the huddled masses of deep debtors.  One third of high school seniors have a credit card, and according to the Tacoma’s News Review, “The number of 18- to 24-year-olds declaring bankruptcy has increased 96 percent in 10 years.”  That’s from an article on a proposal from Washington state Democrat Patty Murray.  Ms. Murray’s proposal would make over a billion dollars available for programs on financial literacy.  The grant funding would be spread over the next five years, and could be used for education across age bands.  With such programs possible from first grade through college, Ms. Murray’s grants could change the way the next generation thinks about money.

It may already be too late for some, however.  After all, half of all college graduates have racked up $5,000 in high-interest credit card debt. From the same article:

Pat Williams, a bankruptcy judge in Spokane, says that when she walks into a class of 25 or so 10th- or 11th-graders, it’s not hard for her to spot the five that will end up in bankruptcy in three years.

“They are dealing with so much, cell phones, car insurance, credit cards, debit cards,” she said. “It was stunning to them to learn there were late charges on a credit card bill.”

If you’re a Bankruptcy Survivor, you may have learned the importance of keeping good credit habits the hard way.  Maybe you’ve spent long hours scheming and analysing, and you’re ready for a new car loan– as a way to rebuild your credit after a bankruptcy.  If so, give Bankruptcy Resourge Group a call.  They maintain a nationwide network of auto loan dealers who specialize in loaning to post-bankruptcy consumers.

Top photo by Lauren Clemson.

March 19, 2009

Tips for Getting an Auto Loan After a Bankruptcy

Filed under: Budgeting, Online resources, Rebuilding Credit — Tags: , , , — C.Welch @ 5:21 pm

There are many reasons to want a new car.  When it’s too rainy to bike, and you don’t have time for the bus, it’s nice to have a car.  And if your old one’s about to fall apart, why not find a new (or new for you) car to take its place?  For Bankruptcy Survivors, there’s one more reason to purchase an automobile: taking out a car loan is a great way to rebuild credit.

But a bankruptcy changes the way lenders look at your credit, so it’s a good idea to be prepared for potential snags in the application process.  Here are a few tips to guide you through taking out an auto loan after a bankruptcy.

  • Budget carefully. Your credit is like an empty canvas following a bankruptcy.  Aside from the record of the bankruptcy itself, your credit is clear, so be careful not to enter any credit agreements that could reflect negatively on you as a borrower.  One part of that caution is budgeting how much you can afford to pay on a car payment per month.  Here’s an online auto loan calculator to help you find a monthly payment you can afford. Learn more about setting up a monthly budget.
  • Review your credit report. Since your arrangements were made for all of your debts in your bankruptcy case, you may assume your credit report is pretty clear.  Don’t assume– be sure.  Order a free credit report and see what your potential lenders will see.  You may consider adding a page explaining why you entered into bankruptcy, especially if extenuating circumstances lead you to file in the first place.  Some kind lenders will take such information into account when providing you with a loan. Get a free credit report from the Federal Trade Commission.
  • Find a lender. Once you’ve gathered all of your information, it’s time to find a lender.  There are many online lenders who have experience arranging loans for Bankruptcy Survivors.  Of course, my favorite is Bankruptcy Resource Group. Call Bankruptcy Resource Group today to take advantage of their nationwide network of dealers specializing in loaning to consumers who have filed for bankruptcy.
  • Make all of your payments early or on time. Once the new car’s in the driveway, make sure you keep up with your new car loan.  Dedicate yourself to making early payments every month, and pay more than required if possible.  Your car loan is a significant chance to prove your good credit habits to lenders.  If you’re a responsible borrower who pays on time every month, your credit score is likely to increase.  Additionally, after six months or a year of consistent payments, you may be able to refinance for a better interest rate or lower monthly payments.  Learn more about wise credit habits for Bankruptcy Survivors.

Top photo by dno1967.

March 16, 2009

When to File for Bankruptcy

Filed under: Attorneys, Financial News, Rebuilding Credit, Uncategorized — Tags: , , — C.Welch @ 6:23 pm

As the recession deepens, more and more Americans are turning to filing for bankruptcy as a way to alleviate heavy debt burdens.  News outlets across the country are reporting a rise in bankruptcy, and local stations are educating consumers on how to tell if it’s a good idea to file for bankruptcy.

Speaking to WOWT Omaha reporter Jeff Sabin, bankruptcy attorney John Turco explained when bankruptcy is the best option for consumers:  “If you’re already at the bottom, if you have enormous credit card debt, you’re being sued, collectors are calling, and you ask me, ‘how is [filing for bankruptcy] going to affect me,’ I think it’s going to affect them in a positive way, because it’s already terrible.”

Chicago Tribune writer Mike Hughlett recently reported that consumers should seriously consider filing for bankruptcy in the following circumstances:

•If you are regularly dipping into your retirement savings.

•If your wages are being garnisheed by creditors.

•If you see no possibility of repaying your debts (being able to muster only minimum credit card payments is a sign).

•If your house is in foreclosure proceedings.

Turco also offered invaluable advice on when to avoid bankruptcy: “If you’re able to struggle through it and buckle down and cut your expenses and get some extra income coming into the household, then my recommendation is if you can avoid bankruptcy, you should. If it’s not necessary, don’t do it.”

Some events that commonly precipitate a bankruptcy are filing for divorce, medical expenses, and losing a job.

If you’re already a Bankruptcy Survivor, congratulations!  You made it through, and now you have a chance to rebuild your credit.  One way to rebuild credit after a bankruptcy is to make a significant new purchase on credit, and consistently make early payments on that purchase.  Taking out a new automobile loan is one way to rebuild credit.  If you’re looking for a reputable, local auto dealer that specializes in working with Bankruptcy Survivors like you, give Bankruptcy Resource Group a call today.  BRG has a nationwide network of friendly auto dealers who can help you rebuild credit through an auto loan.

Click here for further reading on deciding when to file for bankruptcy.

Top photo by Judith.

March 12, 2009

Women Cutting Back Finances More than Men, Consumer Reports Finds

Filed under: Budgeting, Family Finances, Financial News, Rebuilding Credit, Uncategorized — Tags: , , — C.Welch @ 5:53 am

A study released today by Consumer Reports found that American women are more worried about their financial situation than men.  Nearly one third of the people they surveyed said they were financially worse off in 2008 than they were in 2007. 63% of women said they were planning to cut back on holiday spending, compared with only 36% of men.  As MSNBC reports, “Women were also more likely to charge less to their credit cards, cut back on spending for entertainment and eating out, and postpone home improvement projects and big-ticket purchases for their home.”

Another international study released today explored how financially independent women from around the world feel. Market intelligence firm Synovate found that 6 out of 10 women from 12 counties described themselves as financially independent.  Women in Britain, France, and South Africa were the most independent, and offered different definitions of independence.  French women felt financial independence meant “not being dependent on my husband or partner for money,” while Malaysian and Mexican women were more likely to equate financial independence with being debt-free.

If you’re a woman who has experienced bankruptcy, you’re probably quite careful about your finances and taking on new debt.  Although those are generally good financial mantras to live by, sometimes it’s necessary to wisely take out credit.  After a bankrupty, a car or house loan can help rebuild credit.  Of course, you want to be careful about who you talk to.  Bankruptcy Resource Group might be able to help you find an honest car dealer in your area who specializes in helping Bankruptcy Survivors get credit.  Contact Banruptcy Resource Group today to learn more.

Top photo by Gabriel S. Delgado C.

March 10, 2009

Chapter 7 Bankrutpcy Is No Longer Seen As Shameful

Filed under: Chapter 7, Financial News, Mortgages, Rebuilding Credit, Uncategorized — Tags: , , , — C.Welch @ 5:57 pm

The Detroit News ran a great story yesterday on how the dismal economy is bringing more consumers than ever to file for liquidation bankruptcy.  Because so many people are underwater on their homes, and owe more than they are worth, the number of Chapter 7 Bankruptcies has skyrocketed. As Detroit News reporter Jaclyn Trop writes, in the Eastern District of Michigan, “Chapter 7 filings for individuals, which liquidate a debtor’s property and convert it to cash for creditors, increased by more than 25 percent in the first three quarters of 2008 compared with the entire 12 months of 2007.”

As more people turn in their keys so that their home may be liquidated and sold off to pay for their debts, the stigma of filing for bankruptcy is fading.  Instead of being seen as a sign of personal irresponsibility, bankruptcy is seen as many consumers’ only chance to combat mounting debt.

This is especially true in hard-hit areas of the country like Michigan, where unemployment has reached 11.6% of the population.  As jobs evaporate, consumers are forced to get creative about how to settle their debt.  Filing for bankruptcy is the legally-sanctioned method for escaping from mounting credit charges.  Although it’s certainly not a fun process, filing for bankruptcy is a way to start over with a clean slate.

It’s important that Chapter 7 bankruptcies are on the rise, because in this type of bankruptcy the consumer basically sells all of his or her assets to go toward paying lenders.  In contrast, those who file for Chapter 11 hope to reorganize and renegotiate debt to emerge from bankruptcy with some of their assets intact.  (Chapter 11 is often filed by businesses who hope to continue doing business in the long term.)

One issue many new bankruptcy filers may not be aware of is how to rebuild credit following a bankruptcy.  Chapter 7 bankruptcy stays on financial and legal records for 10 years, making post-bankruptcy lenders especially wary.  If you’ve filed for bankruptcy, you should be careful to establish good spending and saving habits afterwords.  It’s also a good idea to rebuild credit.  One way to do this is to take out a loan for a big item, like a house or car.  Bankruptcy Resource Group is a great resource for securing a car loan following a bankruptcy.  BRG has spent years compiling a nationwide network of auto dealers who specialize in lending to people who have survived a bankruptcy.  Contact Bankruptcy Resource Group today to learn more.

Top photo by WalkinBoston.

March 5, 2009

Tips for Buying a Home after a Bankruptcy

Filed under: Budgeting, Mortgages, Rebuilding Credit, Uncategorized — Tags: , — C.Welch @ 7:46 am

Even though many people are suffering due to real estate worries, some people are still buying new homes.  And new homes are being built, despite the fact that many experts estimate that more than a year’s worth of real estate currently sits on the market.  And if you happen to be in a position to be able to put down a tidy down-payment, this is a great time to buy a house.  Prices have dropped to pre-bubble levels, and it’s quite possible to find affordable, well-kept, and even stylish homes in attractive neighborhoods.

If you’ve been through a bankruptcy, you may be worried about being approved for a home loan.  While the credit crisis has made many lenders more cautious, if you’ve built up a good credit history and you have a substantial down payment, you can get a home loan.

Here are a few tips for those hoping to buy a home after a bankruptcy.

  • Don’t buy stuff just because you’re debt free.  Plan, strategize, and even agonize over any large purchase, especially as a new house.
  • Just to reiterate that last point, Do The Math.  Sit down and figure out your income and expenses, and estimate what size of payment you can comfortably make each month.
  • Avoid getting locked in for two or three years.  Some so-called “bad credit loans” require that the borrower pay on time for the first three years, or face foreclosure.

There are a few nuggets to get the conversation started.  Are you trying to buy a home after a bankruptcy?  Or have you already bought a home?  What can you tell those who are following in your home-owning footsteps?

If you’re looking for another way to build credit after a bankruptcy, Bankruptcy Resource Group can help.  They maintain a network of auto dealers who specialize in lending to consumers who have survived a bankruptcy.  Contact Bankruptcy Resource Group today to learn more.

Top photo by Chris Griffith.

March 4, 2009

Three Tips For Saving Money at The Grocery Store

Filed under: Budgeting, Family Finances, Saving Money, Uncategorized — Tags: , , , , , — C.Welch @ 7:04 am

In their evening show for March 2, APM’s Marketplace focused on the new chic around saving money.  On that program, behavioral economist Dan Ariely remarked, “It’s like Scrooge is back, and he’s back with less social stigma against him.”  More people are talking about money more openly.  Since nearly everyone is being effected by the bad economy, many people are talking about money simply to share the troubles in their life.

Personally, I’m glad my thrifty ways are finally “in.”  I’ve never understood the need for brand name goods when the generic counterpart will do.  With everyone suddenly trying to save money, these days feel like Revenge of the Coupon Clippers for those of us who have been pinching pennies all along.

Here are a few tips for saving money at the one store nearly every American visits two or three times a week:  the grocery store.

How to Save Money at the Grocery Store

1.  Buy Generic. If you’re still convinced that the brand names are better, check the ingredients of your favorite products.  There are few food items that aren’t as good in the generic form.  I grant that I buy local cheeses that I know, rather than the generic variety.  But nine times out of ten, if I have a choice, I reach for the generic version. And there’s nearly no reason to buy brand name drugs, since generic medicines nearly always contain the exact same ingredients.

2.  Compare price per weight, rather than overall price. Have you noticed that cereal boxes seem to be shrinking?  As their costs rise with the recession, manufacturers are offering less food for the same price, rather than raise their prices.  With this kind of subtle packaging going on, it’s especially important to notice how much food each package contains.  The brightly colored tags below each item contain more than just the price:  they also clearly show how much each product costs by weight.  This tag usually shows how much the food costs per ounce.  Once you know that price, you can more easily spot the least expensive option.

3. Maintain and stick to your grocery list. Much as most casinos have mirrored walls to confuse patrons into walking back into their bellies, grocery stores are designed to keep you in the store, adding new spontaneous purchases to your cart.  If you’ve ever experienced sticker shock after a meandering grocery shopping trip, you’ll appreciate the importance of keeping a  list.  Before leaving the house, get ready for the store by figuring out what you actually need.  Better yet, keep a blank list on the ‘fridge and note what you need as you run out of each product.  Once your list gets long enough to warrant a trip, buy only what’s on your list and avoid the tempting “sale” displays.  (These are usually paid for by the manufacturer, and are rarely the best price.)

Finally, think about your budget and stick to it in the store.  If you know you’ll put too much on a credit card, just take a trip to the ATM before heading to the store.  Buy groceries in cash if you know credit brings you headaches.

If you’re looking for ways to rebuild credit after a bankruptcy, Bankruptcy Resource Group can help.  Give them a call today and learn more about how they can help you find friendly local auto dealers who specialize in extending credit to people who have less-than-perfect credit histories.

March 3, 2009

Collateral Credit Cards Cautions and Concerns

Filed under: Rebuilding Credit, Uncategorized — Tags: , , , , , — C.Welch @ 3:50 am

Before Bankruptcy Survivor got distracted by Obama and other celebrities, we were focusing on collateral credit cards as a way to rebuild credit after a bankruptcy.  Banks and other lenders offer collateral credit cards to consumers who might not qualify for traditional credit.  When you open a collateral credit account, you put a deposit down, which the bank keeps if you fail to pay back what you borrow. Collateral Credit Cards may also be referred to as secured credit cards.  As Emily Starbuck Gerson and Ben Woolsey write for CreditCards.com, “A security deposit of a predetermined amount is needed in order to secure the credit card, and the security deposit generally needs to be of equal or greater value than the credit amount. Collateral can come in the form of a car, boat, jewelry, stocks or anything else of monetary value.”

Lenders may require an application fee for taking out a collateral credit card.  Before signing your name to the application form, be sure you understand the terms of the loan.  Some untrustworthy lenders may try to trap you into paying high fees if your payment is even a day late.

Also be sure that you fully understand the interest rate of the secured card.  Because these accounts are designed to be used over short periods, to assure banks that the borrower is responsible enough to deserve a higher credit rating or extended credit line, interest rates can run as high as 18%.  If you’re taking out a collateral credit card following a bankruptcy, you’ll hope to “graduate” to a card with a lower interest rate and higher credit limit within a year, but you’ll still have to cover the interest rate of the collateral card.  (Of course, you must make your payments on time when you have a collateral card– if you don’t, the bank could seize your deposit, and your credit score will probably fall.)

Shop around at different local banks. Compare their offers.  Don’t be afraid to ask the bankers questions, or ask for a better rate.  Due to the economic crisis, bankers are dependent on new borrowers.  You are the customer, and each banker knows they’re competing for your credit business.  Ask for better deals, and you just might get them.

One deal to look out for is a built-in method for moving to a higher card within a certain amount of time.  Smart lenders  recognize that many consumers are trying to pay off their debts on time to improve their credit scores.  These lenders could have special plans for collateral card holders, earning them better deals if they regularly make their payments on time.

Collateral credit cards are a systemized method for rebuilding credit following a bankruptcy.  Taking out a car loan is another way to rebuild credit.  Basically, when you make consistent on time payments on any debt, large or small, credit agencies will likely increase your credit score.   To find an auto dealer near you who specializes in helping Bankruptcy Survivors, give Bankruptcy Resource Group a call today, or fill out their easy online application.

Top photo by Andres Rueda.

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