The economy is doing just great… well so says the banks (sarcasm).
The Associated Press reports tonight that bankruptcies are surging. And that is with the new bankruptcy law that was passed in 2005 which makes it much more difficult for individuals to file bankruptcy.
The number of U.S. businesses and individuals declaring bankruptcy is rising with a vengeance amid the recession, despite a three-year-old federal law that made it much tougher for Americans to escape their debts, an Associated Press analysis found.
“There’s no end in sight,” said bankruptcy lawyer Bryan Elliott of Hickory, N.C., who is working seven days a week and scheduling prospective clients a month in advance. “To be doing this well and having this much business, it is depressing. It’s not a laugh-a-minute job.”[...]
[...]Nearly 1.2 million debtors filed for bankruptcy in the past 12 months, according to federal court records collected and analyzed by the AP. Last month, 130,831 sought bankruptcy protection — an increase of 46 percent over March 2008 and 81 percent over the same month in 2007.[...]
[...]Congress voted in 2005 to make bankruptcy more cumbersome after years of intense lobbying from the nation’s lenders, who complained that people were abusing the system. Before the move to change the law, bankruptcies were running at what was then an all-time high of about 1.6 million per year.
The tighter requirements initially appeared to work, with bankruptcies plummeting from a record-shattering 2 million cases in 2005 — a total that reflected a rush to file before the new law took effect — to 600,000 in 2006. But now bankruptcies are booming again.[...]
[...]“You wouldn’t get this large of a rise without serious problems in the economy,” said Lynn LoPucki, a UCLA law professor who researches bankruptcy.[...]
In 2005 the banks and financial institutions lobbied congress to make it more difficult for individuals to file bankruptcy. Now those very same banks are increasing interest rates to 29, 30, and even 34%, cutting credit limits by significant amounts, and even changing terms in the ‘card member’ agreements in some cases to now include the following:
“We may consider you in default if we obtain information that causes us to believe that you may be unwilling or unable to pay your debts to us or others on time.â€
“If we consider your account to be in default, we may close your account without notice and require you to pay your unpaid balance immediately.â€
The above excerpt is reportedly now included in the JP Morgan / Chase Credit Card agreements. So even if you are paying your bills, Chase can decide that you ‘might‘ someday not pay and decide to put your account into default without even telling you and then demand full payment immediately.
(warning: soapbox statement coming)
Just who the hell runs this Country? I think the answer is clear: The banks run the country and the tax payers have been bent over the railing many times; from the bailouts, executive pay, raising credit card interest rates to levels that make it impossible for people to pay off, and then we have to give them more money from our hard earned salaries.
This is madness!
Have a credit card? Stop using it, pay it off and get rid of it for good. Use a debit card/check card for making purchases. But don’t give one more cent to these banks and financial institutions, not one cent.
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I advocate cutting up the credit cards and using cash. JP Morgan, Bank of America, et al, issue credit cards. Trash those cards
I don’t want to eschew technology and, yes, I know it is more convenient to use the cards, but I ask this: where is your line in the sand? Where do you take a stand, people? We have to show the banks/government we mean business. This is just one little method.
I work with financial institutions and remember when this bankruptcy “reform” was implemented in 2005. Yes, it’s all a sham and it’s not just the banks in on this. The trial lawyers association had been the roadblock for many years to “reform”, they had to sign off on the reform, as the “bankruptcy business” is an integral part of their business model, lol. Also, many members of Congress are attorneys and former/current trial lawyers association members. So, Congress and the trial lawyers association are as much to blame as the banksters and financial pirates, which they really are anyway.
our family puts everything it purchases on one credit card. When the bills comes, we pay it immediately. In just the past two years, we have gotten $1500 back in rewards and have bought our scaffolding. They don’t like for you to do this. You’re called a “deadhead,” I think, because they lose money on you. If everyone would do this, we could bankrupt the credit card companies.