Bankrupt for less than 5 Months - Discharged

njwd

Richard_S wrote:

Steady on TTMCM, it was only a request for information, you're jumping to a number of unfounded and unreasonable conclusions.

Please spare us the "poor old lenders" rubbish, we are talking about the same institutions responsible for enslaving the third world in the eighties and then forcing them into poverty and starvation in the nineties; and Bingo, another vulnerable market - "let's lend recklessly to consumers in the UK" and watch them squirm when we decide the markets saturated and we want to move on.

Unfortunately these "poor old lenders" will no doubt pass the cost of all these bankruptcies and IVAs to "poor old Joe Bloggs". You can be damn sure that their shareholders won't suffer.

Richard_S

TTMCMschine wrote:

Please spare me the guff about "empoverishing nations" & "vulnerable borrowers." Many of the debts will have been sold onto pension funds, etc, so there are real victims at the end, not even considering the eventual effects to the economy.

People need to be accountable for their own actions, no matter how painful it is, instead of going for the sympathy vote by claiming to be a "victim."

I agree that people should be responsible for their own actions, anybody that's been through bky is paying the ultimate sanction. Similarly, financial institutions should be responsible for their actions, I have two close friends who work in banking and finance and my opinion, (and theirs) is that the methods they use to sell financial products is absolutely appalling.

Richard_S

njwd wrote:

Unfortunately these "poor old lenders" will no doubt pass the cost of all these bankruptcies and IVAs to "poor old Joe Bloggs". You can be damn sure that their shareholders won't suffer.

If "Joe Bloggs" does end up paying then I accept that Joe will have every reason to justifiably complain. However, I think it's far more likely, given the competetive nature of the business, that profits will fall and as a consequence returns to shareholders.

scootw1

Richard_S wrote:

If "Joe Bloggs" does end up paying then I accept that Joe will have every reason to justifiably complain. However, I think it's far more likely, given the competetive nature of the business, that profits will fall and as a consequence returns to shareholders.

I doubt very much that shareholders will lose out. In industry, it's always shareholders first and stuff the consumer.

barnaby-bear

Richard_S wrote:

If "Joe Bloggs" does end up paying then I accept that Joe will have every reason to justifiably complain. However, I think it's far more likely, given the competetive nature of the business, that profits will fall and as a consequence returns to shareholders.

And loads of those shareholders will be pension funds, so the cost gets passed on to some old boy, who scrimped for his pension and fought in the war.

Sisyphus

Richard_S wrote:

If "Joe Bloggs" does end up paying then I accept that Joe will have every reason to justifiably complain. However, I think it's far more likely, given the competetive nature of the business, that profits will fall and as a consequence returns to shareholders.

The higher the risk, the higher the yields required by investors. Every bankruptcy will put up the cost of credit for the next borrower. We have been fortunate to have been in a long cycle of cheap credit. This has been a boon to the housing market and the retail market through mortgages and credit card lending. I'm not sure how much of this credit has been available to genuine industry and will provide growth for future generations.
Obviously, many are happy to use and abuse the system, why should they care? The problem is that this cheap cycle is coming to an end. Stories of fast discharges to bankruptcies will do nothing to deter those amongst us who negligently overstretch ourselves. Thereby the credit pool will dry up for future generations.

scootw1

Sisyphus wrote:

The higher the risk, the higher the yields required by investors. Every bankruptcy will put up the cost of credit for the next borrower. We have been fortunate to have been in a long cycle of cheap credit. This has been a boon to the housing market and the retail market through mortgages and credit card lending. I'm not sure how much of this credit has been available to genuine industry and will provide growth for future generations.
Obviously, many are happy to use and abuse the system, why should they care? The problem is that this cheap cycle is coming to an end. Stories of fast discharges to bankruptcies will do nothing to deter those amongst us who negligently overstretch ourselves. Thereby the credit pool will dry up for future generations.

I don't think it's so much a matter of risk. The companies have to maintain their high profits levels both for their shareholdeers and directors and with each bankruptcy/IVA their profits decrease so costs have to go up to compensate. Perhaps government should step in and cap the interest levels companies can charge.

Mike_St_Helens

Sisyphus wrote:

The higher the risk, the higher the yields required by investors. Every bankruptcy will put up the cost of credit for the next borrower. We have been fortunate to have been in a long cycle of cheap credit. This has been a boon to the housing market and the retail market through mortgages and credit card lending. I'm not sure how much of this credit has been available to genuine industry and will provide growth for future generations.
Obviously, many are happy to use and abuse the system, why should they care? The problem is that this cheap cycle is coming to an end. Stories of fast discharges to bankruptcies will do nothing to deter those amongst us who negligently overstretch ourselves. Thereby the credit pool will dry up for future generations.

I agree with you... Indeed, I look now and think why on earth did that bank lend me so much money? Yes I spent it, I was daft enough to try and better myself by going into business...However not all people go BK simply because they can, you must bear this in mind at least....

Sisyphus

scootw1 wrote:

I don't think it's so much a matter of risk. The companies have to maintain their high profits levels both for their shareholdeers and directors and with each bankruptcy/IVA their profits decrease so costs have to go up to compensate. Perhaps government should step in and cap the interest levels companies can charge.

It is entirely a matter of risk or perceived risks.
Why do you think a bank can borrow money at Libor and you have to pay Libor +x%? Those spreads had narrowed in recent years, bankruptcies will cause them to widen again. Increasing the cost of credit for everyone. There is no such thing as a free lunch.

scootw1

Sisyphus wrote:

It is entirely a matter of risk or perceived risks.
Why do you think a bank can borrow money at Libor and you have to pay Libor +x%? Those spreads had narrowed in recent years, bankruptcies will cause them to widen again. Increasing the cost of credit for everyone. There is no such thing as a free lunch.

But what I'm saying is that the costs increase for people to maintain the CC companies profits. The cost would not go up for everyone else because of risk from other customers who are paying their bills.