Day: August 21, 2019

Filing Chapter 7 Bankruptcy: The Pros and Cons You Need to Know

Nobody in this busy world wants to file for bankruptcy. However, if debt settlement and negotiation are not sufficient to resolve your financial crisis, then you may have no other option.

Calling bankruptcy implies that you have come to the end of your financial rope and have no means to pay your existing debts like car loans. For people facing overwhelming debt because of buying a car, filing for chapter 7 bankruptcy is regarded as one of the few means to initiate a bankruptcy fresh start program, erasing the obligation to repay and giving you a chance to get on with your life.

The decision to file for chapter 7 bankruptcy is a big one and it has its pros and cons, which you need to pay attention to.

Generally, a debtor can select to file for either a chapter 7 bankruptcy or a chapter 13 bankruptcy. But mostly, all individuals file bankruptcy under Chapter 7. It is referred to as a ‘liquidation bankruptcy’ because it involves a gathering of the property and assets and selling them to pay off as much as debt as probable before the remaining debt is discharged.

Ultimately, you can erase your debt with a chapter 7 bankruptcy or even create a repayment plan with chapter 13 bankruptcy when you’re planning to opt for a car loan.

Real Examples of Chapter 7 Bankruptcy

Example 1:

Mia is a retired educator on a fixed income. She decided to sell her home before moving in with her daughter. She had great credit score because of on-time payments on her mortgage and she never had debt. Later, she agreed to co-sign on a home loan for her granddaughter and a car loan for her grandson. Well, she couldn’t say no!

But 2.5 years later, the house was repossessed when the granddaughter had a divorce. The grandson’s car was repossessed after he lost his job. A substantial amount of debt was remaining after the house and the car was sold at an auction.

Mia, in critical health, was cornered by creditors. She filed a Chapter 7 bankruptcy which stopped the harassment and rejected the deficiency claims. Her social security and retirement money were ultimately excused and protected.

Take note that if you file for Chapter 7 bankruptcy while paying off a vehicle loan, you’ll need to decide whether or not you’d keep the vehicle.

If you decide to surrender the vehicle, you’ll have to forfeit the sum you’ve paid toward the loan. Nevertheless, the creditor won’t be able to sue you for the balance once the vehicle is sold at the auction.

Pros and Cons of Chapter 7

Declaring for chapter 7 bankruptcy may seem like an amazing idea. It can relieve your debt and offers a chance to rebuild and get a fresh start. Nevertheless, you should definitely also be aware of the upsides and downsides of it.

Upsides

chapter 7 bankruptcy

Bankruptcy is common: There’s nothing to be embarrassed about bankruptcy. It’s quite common and, honestly, the best option in various scenarios. Businesses have a downfall and credit cards spiral as the interest rates increase. Even Donald Trump has filed bankruptcy.

Makes you financially disciplined: If you ever plan to buy a car again, you will require to be economical and accountable about debt. You’ll be able to demonstrate perfect ability to pay those car loans on time even though there might be open lines of credit in the later future.

Eliminate credit card debt: That’s a big one. Credit card use is a common cause of declaring bankruptcy. Individuals often pay off vehicle loans with credit cards when cash isn’t readily available, and debt gradually snowballs from there. Filing for chapter 7 bankruptcy permits you to start fresh without credit card car debt.

See Also: How to Get Out of Credit Card Debt Fast

No effect on your wages: Wage garnishment happens when lenders have a court order that permits for a part of your pay check to get sent to your lenders. However, when you apply for Chapter 7 bankruptcy, it will stop from happening. It can, at the end of the day, improve your income as you’ll be able to keep the money you worked hard for. This doesn’t work in cases of student loans, child support, and taxes.

Downsides

file chapter 7 bankruptcy

A downfall for credit score: Credit rating can be severely damaged when you file for chapter 7 bankruptcy. It lowers the score by 200-250 points, which stays on till 7-10 years. This can make it quite difficult for you to qualify for fresh car loans and credit for nearly 3-4 years.

Won’t erase student loans: Student loans for buying a car cannot be erased with bankruptcy. If it is your debt, then you’ll definitely be on the hook to pay it. However, it prevents creditors from taking aggressive collective action which absolutely helps. Proving that your student vehicle loans are too much of a liability is a very tough task. It mostly requires a separate lawsuit and an attorney.

See Also: 5 Strategies For Paying Off Student Loans Fast

Loss of expensive property: In the process of filing, you will most likely lose some of your assets, especially extraneous luxury items including all sorts of cars. These goods are used in repaying your creditors and depending on your state’s exemption laws, you might be required to give up on material things that you’d rather not.

Six-year filing: Chapter 7 bankruptcy can only be filed every six years. This encourages all those who recently filed bankruptcy to keep their head above the water and be attentive.

Final Thoughts

We would just like to make you aware that the most significant thing is to analyze your own personal financial situation. Compare consumer car debt solutions in order to select the best resolution for your financial situation.

If you have nominal assets and merely require a fresh start, then chapter 7 can definitely help you.

But if you think that your situation is a bit more complex, then it can still be significant for your financial situation. It’s vital to get direction on whether chapter 7 or chapter 13 would be the right option for you. While our brief list of pros and cons may be helpful to you when it comes to opting for car loans, it’s honestly just the beginning.

The post Filing Chapter 7 Bankruptcy: The Pros and Cons You Need to Know appeared first on Dumb Little Man.

The first reactions for ‘IT Chapter Two’ are in and everyone’s obsessed with Bill Hader

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Get your therapist on speed dial, because IT Chapter Two is nearly here to retraumatise you with everything from a scary clown to how harrowing growing up is — and the first reactions are in as critics and fans stream out of the first screenings.

The overall mood is: IT Chapter One, but more. If you found yourself picking holes in the first movie, you’ll probably be frustrated again; if you loved the personal stakes and the characters, there’s that in spades here, with performances from the adult Losers to rival any “serious” drama; and the ending might make you cry.

And if it made you lose sleep, you can look forward to more of that too. Read more…

More about Horror Movies, Bill Hader, It Chapter Two, Entertainment, and Movies Tv Shows

Fresh out of Y Combinator, Tandem lands millions from Andreessen Horowitz

Tandem, one of the most sought after companies to graduate from Y Combinator’s summer batch, will emerge from the accelerator program with a supersized seed round and an uncharacteristically high valuation.

The months-old business, which is developing communication software for remote teams after pivoting from crypto, is raising a $7.5 million seed financing at a valuation north of $30 million, sources tell TechCrunch. Airbnb investor Andreessen Horowitz is leading the round.

Tandem and a16z declined to comment for this story. The round has yet to close, which means the deal size is subject to change. Y Combinator startups raise capital using SAFE agreements, or simple agreements for future equity, which allow investors to buy shares in a future priced round at a previously agreed-upon valuation.

We’re told several top venture capital firms were vying for a stake in Tandem. One firm even gifted the founders a tandem bike, sources tell TechCrunch, resorting to amusing measures to sway the Tandem team. But it was a16z — which has an established interest in the growing future of work sector, evidenced by its recent investment in the popular email app Superhuman — that ultimately won the coveted lead investor spot.

Tandem provides a virtual office for remote teams, complete with video-chatting and messaging capabilities, as well as integrations with top enterprise tools including Notion, GitHub and Trello. The service launched one month ago and has signed contracts with Airbnb, Dropbox and others. The company claims to be growing 50% week-over-week.

“Every company is a remote company,” Tandem chief executive officer Rajiv Ayyangar said during his pitch to investors on day two of Y Combinator Demo Days this week. “You have salespeople in the field, [companies with] multiple offices, people working from home. Tandem isn’t just building the future of remote work, it’s building the future of work.”

Ayyangar was previously a data scientist at Yahoo before joining Yakit, a startup seeking to simplify ecommerce delivery, as the director of product. Co-founders Bernat Fortet Unanue and Tim Su are also Yahoo alums.

We’re told Tandem’s fundraise was nearly complete before it pitched to investors Tuesday afternoon. Startups that participate in YC are often flooded with offers from VCs throughout the three-month program. Firms are hungry for the batch’s Airbnb, Dropbox or Stripe — graduates of the program — and will pay premiums on startup equity for their chance to invest in a future ‘unicorn.’

As a result, the median seed deal for U.S. startups in 2018 was roughly $2 million — a record high — with typical pre-money valuations hovering north of $10 million. Tandem’s seed financing represents both a trend of swelling seed deals and valuations, as well as a tendency for VCs to dole out more cash to fresh-from-YC companies amid heightened competition amongst their peers.

The previous YC batch, which wrapped up in March, included ZeroDown, Overview.AI and Catch, a trio of companies that pocketed venture capital ahead of demo day. ZeroDown, a financing solution for real estate purchases in the Bay Area, raised upwards of $10 million at a $75 million valuation before demo day, sources told TechCrunch at the time (months after demo day, Zero Down announced a whopping $30 million financing). ZeroDown was an outlier, of course, as the company’s founders had previously co-founded the billion-dollar HR software company Zenefits.

As for the summer batch, we’re told Actiondesk, Taskade and Tandem are amongst the startups to garner the most hype from investors. Some even forwent the demo day pitch altogether. BraveCare, which is creating urgent care clinics intended just for kids, raised $4.1 million ahead of demo day, we’re told. The company opted not to pitch to additional investors this week.

You can read about all the company’s that pitched during demo day one here and demo day two here.