Archive for the ‘Bankruptcy’ Category

Top 8 Bankrupt Celebrities – Do you know them?

The economy has been tough on all of us and some of the rich and famous has fared no better than the rest of us. Do you know these celebrities that filed for bankruptcy over the years?

Stan “the man” Lee

Did you see Spider-man 1,2,3,4, The Fantastic Four, The Incredible Hulk or any of the X-men movies? If you did you probably put money in the pocket of this man then he promptly mishandled it to the tune of millions. So in 2001 good Stan the creator of all our beloved superheroes filed for bankruptcy.

Donald Trump

Your Fired! The Donald is near the top of this list for being a two time filer of bankruptcy in the same decade no less. Now that’s business savvy. The 1st time Donald T went B-rupt was in 2004 when he had to give up control of Trump’s Atlantic City Hotel and Casino. He resurfaced sometimes later with the new name Trump Entertainment Resorts which tanked out in 2009. Now he is going for the hat trick as he has recently climbed back into the leadership chair of the corporation. Good Luck on the trifecta, I am putting my money on D Trump.

Stephen Baldwin

The Baldwin clan’s baby brother tried to make a comeback into the fame on game shows and reality television programs but, budgeting as a television star and budgeting as an average Joe still has the same formula; add debt and spending then subtract income. If income is not enough you end up in bankruptcy court, which is where Stephen and his wife ended up after losing their home in 2009.

Kim Bassinger

From walking down red carpets to strolling into courtrooms, Kim at one time owned an entire town but that was before her run in with a judge after being suited by a movie producer that she left holding the bag. The judge demanded that she pay the producer over $7.5 million dollars which she could not come up with. This led her to stroll into another courtroom to talk with another judge in bankruptcy court.

Burt Reynolds

An American icon the Bandit is responsible for hundreds of millions in box office receipts. But, if we go back to the formula above having over $9 million in debt and your ratio of income does not match your payback schedule and you are going to need more than a 1977 Pontiac Firebird Trans Am to out run the bankruptcy judge.

Larry King

Another radio and television icon that ran into serious cash flow problems in the late 1970s is filing for bankruptcy. Now his famous show on CNN has him back in the black.

Don Johnson

Crockett, Tubbs and that white 1984 Ferrari Testarossa you remember them or maybe you don’t that was a generation ago and maybe that is why Don had to sell that car to get cash to cover his debts after going bankrupt. He had to have hated that, because that was one sweet car.

Willie Nelson

Between tokes all the money went up in smoke and the tax man got Willie for over $15 million in back taxes. Good thing he does not change his clothes much or his hairdo.

Tags: Bankruptcy
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How does bankruptcy affect your Credit Report?

There is no doubt that bankruptcy deals a devastating blow to your credit and your credit score. Anyone who has had a bankruptcy can tell you that it is best to only consider bankruptcy as your last option available to you. But sometimes when our finances reach a certain point and bankruptcy is the best solution then filing for bankruptcy can provide relief to some extent. It will no doubt halt the never-ending harassment from collecting agencies, collection phone calls, creditors and those non-stop collection notices. However, the after effect of having a bankruptcy on your credit nonetheless is devastating and leaves a black mark on your credit report for a long time.

How long does a Bankruptcy remain on my Credit?

A Chapter 7 bankruptcy will remain on your credit report for 10 long painful years from the date of filing. A Chapter 13 may stay on your credit for 7-10 years. This can be very devastating especially in the society we live in today where so many of us buy on credit or have to have credit to just get by.

Two Types of Bankruptcy

1. Chapter 13 Bankruptcy

Chapter 13 Bankruptcy will not discharge your obligations, but allows you to work out a payoff plan that you can handle. Chapter 13 is there to assist those who have a temporary financial situation such as a catastrophic illness or loss of employment.

A Chapter 13 will still have a negative effect on your credit report but it also shows that you are taking responsibility and living up to your obligations by continuing to pay your debt rather than having them discharged. This is recommended especially for those who still have a regular income and don’t want to have a discharge on their credit. With a Chapter 13 bankruptcy, you are able to obtain new credit within a year or so.

2. Chapter 7 Bankruptcy

Having a Chapter 7 bankruptcy is the worst thing you could have on your credit report. Chapter 7 makes life extremely difficult especially when credit is involved. It makes obtaining new loans and credit cards difficult to get for at least a few years or sometimes even longer.

The after-effects of Filing for Bankruptcy

The effects of bankruptcy on your credit will depend on the type of bankruptcy you file.

• After two years of being discharged, you may be able to obtain a home loan with a Chapter 7 on your record
• It will take about one year after filing a Chapter 13 bankruptcy to obtain a home loan.
• Revolving charge accounts or credit cards will be extremely difficult to get because they are based on each lender’s credit standards.

Did you or do you know someone who filed for bankruptcy? Tell us about your experience.

Tags: Bankruptcy, Credit Report
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Top 10 Tips to Avoid Bankruptcy

Bankruptcy is never the first choice of any individual or company who is facing a financial crisis. However, every year thousands of individuals are faced with this choice of filing for bankruptcy due to the protection it gives them to reorganize their lives and businesses. This may sound good on the face of it, but in reality, filing for bankruptcy severely restricts your purchasing power, as individuals must make stringent changes to get out of debt. In addition, filing for bankruptcy remains on your credit record for at least ten years.

There are some steps that individuals can take to avoid bankruptcy. This advice is not a legal binding, as individuals will face their own scenario and this will give the basic idea on how to handle situation when in bankruptcy. However to avoid bankruptcy, individuals can:

1. Good Financial management: The best way of avoiding bankruptcy is through good financial management. Always put away something for a rainy day. This money must only be touched only in cases dire emergencies.
2. Increase income: The first step in avoiding bankruptcy is to increase your monthly income. This can be achieved by getting a second job. It does not matter how small the salary is per week, it all adds up at the end of the month and can go a far way in reducing your debt.
3. Stop using credit cards: Credit cards encourage you to spend and are one of your main sources of financial demise. Do what you have to do, freeze them, hide them whatever, but remove them as a source of finance for your daily expenditure. You can keep one only for emergencies.
4. Debt consolidation: Refinancing is another good way of avoiding bankruptcy. Under refinancing, the refinancer will pay off all your existing debt and give you a new loan with a more reasonable repayment schedule over a longer period. This may also in the short-term increase your liquidity as more cash becomes available from the reduced monthly payments.
5. Taking a second mortgage: If you own a house and its value can cover the extent of your debt, a second mortgage loan is a good option. However, if its value does not cover your debt, this is not a good option.
6. Selling valuables: Being on the brink of bankruptcy is a dangerous time. As a result, serious decisions must be made. Assess what valuables you possess that if sold can bring in some much need money that can contribute to relieving your debt.
7. Selling your car: Unlike a house, the value of cars will depreciate. Selling your car now, will give you more money than delaying it until next year, or whenever the crisis becomes critical.
8. Budgeting: When bankruptcy comes knocking at your door, budgeting can be a life savior. Implement strict budgeting conditions. Every month write down what you need and not you want before going shopping.
9. Life style changes: One must adjust their lifestyles to suit their financial conditions. Do not go clubbing if you know your rent or credit card is not yet paid. Reduce your power consumption and other non-essential utilities.
10. Negotiate with creditors: If you have exhausted all your options in trying to streamline your finances, then try renegotiating with your creditors to give you more time or the ability to make smaller monthly re-payments.

Tags: Bankruptcy, Credit Cards, Debt Consolidation, Second Mortgage
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