Write off you debts under £15K

[Lurking Lawyer]

I haven't seen Tonker posting for a while but I think we can all imagine just what he'd have to say on this subject!

[havoc]

swerni said:

havoc said:

swerni said:

you see where this is going to lead.
No unsecured loans for under £15k.

Then all the tossers (see banking scam thread) will start moaning that it's not fair, the bank won't lend them any money.

It's called Karma

No. MOST people wouldn't dream of taking out a loan they couldn't afford, and would be horrified to have to default on a debt. But there are a few (increasing, but still I would hope a small minority) who DO take the piss...it is these that will abuse this rule the same way they've abused other rules.

And it is the 'most' group who will suffer as a result.


Try not to see the world in such black-and-white terms.

you are kidding aren't you?

The main reason the economy is in the state that it is in right now is people borrowing money they can't really afford

I think you'll find that the Financial Services industry contributed A LOT to that particular mess, and that they should be the ones reaping what they sowed.

Yes, a fair few people were disingenuous / dishonest (I've zero sympathy there), and a fair number more got suckered in by the whole 'house prices will keep rising' fallacy (I've a little sympathy there, as the 'experts' were peddling this mantra. Personally, we've been wanting to move for >2 years, but I could see this coming so we've stayed put deliberately).

But while I don't think this proposal is anything other than a stupid idea, I also don't think that your original suggestion that ALL those who would then moan about not being able to get an unsecured loan (which would include me, as it happens!) would be getting what they deserve!

The banks were stupid and greedy and chased the profits available from these higher-risk customers, and now, if your suggestion proves true, it is the HONEST punters who will lose out from the actions of those running the banks and those taking advantage! As usual, I would suggest...

[ukwill]

AJS- said:

ukwill said:

It's the fault of the Company offering finance?

How warped does this get?

Yes, of course. It's the job of the investor/creditor to ensure that he is making solid loans and good investments. In this case, they didn't do this, in fact they guaranteed finance to anyone who had 4 weeks of steady employment, often at exhorbitant interest rates, probably working on something like a 50% default rate. Mass default was built into their business models, just not mass default all at the same time.

This business model actually puts a fairly big burden on the magistrates and bankruptcy authorities, so why not reduce this burden by streamlining a process which is almost inevitably fruitless anyway.

The debtors will suffer a bad credit rating but if this can be done quicker and cheaper than a full scale bankruptcy which will produce nothing for creditors anyway (as the person has no assets) then it's better for all.

As I said, somewhat playing Devil's advocate as I think the bankruptcy laws could probably deal with it just as well.

That all seems a bit in retrospect though doesn't it? The companies offering finance were not doing anything illegal. When you take out finance agreements you have to sign the contract. You have to read the contract. You are also told key points about the financial aspect of the agreement. In that respect, the companies met their obligations. You not being able to make the repayments mean that you don't meet your obligations. That is your problem, not theirs.

[ShadownINja]

Oakey said:

ShadownINja said:

Oakey said:

AJS- said:

Playing Devil's advocate a bit here, but part of me thinks, serves them right. A lot of these companies have spent the last 10 years cashing in on selling stupidly easy credit to vulnerable and simple people they knew wouldn't be able to pay it back. Then shuffling their massive junk loans around and bundling them up in ever more convoluted ways to sell them on to debt collectors.

The simple fact is they were never going to get this money back, and having an ongoing st fight between thuggish debt collectors and equally useless borrowers in their council flats with broken plasma screens serves no useful purpose. Dragging them through the courts is still useless as they don't have anything worth seizing, and won't have anything worth seizing however bankrupt you declare them.

A law like this actually just gives a more orderly way to close this and move on. In the short run

On the other hand, the moral hazard is enourmous. Why wouldn't you now take out an unsecured loan with no intention of paying it back? On the other hand, why would you lend one. Ultimately this will mean that these sort of debtors are sent into the waiting arms of loan sharks who have other ways of collecting on unpaid debts.

Now where's Ocean finance's number.

It can only be done once every six years so I think that will curb any abuse.

Free £15k every 6 years? Where do I sign up?

Because of course, for all the crap that comes with a DRO, it's well worth doing for £2500 a year?

I'm just playing. I don't borrow money.

[sleep envy]

AJS- said:

A lot of these companies have spent the last 10 years cashing in on selling stupidly easy credit to vulnerable and simple people they knew wouldn't be able to pay it back.

yes, what we really need to do is protect the weak, wrap them up in cotton wool and protect them from themselves

I know, since we can't distinguish them from the rest of society why don't we have blanket legislation to stop people making their own choices and taking responsibility for their own life/actions

we can hand everything over to central govt and let them make all key decisions seeing as they know best and are doing such a fantastic job of steering us though this recession

[AJS-]

ukwill said:

That all seems a bit in retrospect though doesn't it? The companies offering finance were not doing anything illegal. When you take out finance agreements you have to sign the contract. You have to read the contract. You are also told key points about the financial aspect of the agreement. In that respect, the companies met their obligations. You not being able to make the repayments mean that you don't meet your obligations. That is your problem, not theirs.

They did what they were required to legally, but they did not do due dilligence to ensure that they would get their money back from the debtor. Rather they simply bundled the debt up and sold it at what now seem to have been optimistic prices.

It is retrospective in the sense that it might have been better to absolve the bankruptcy courts of the inevitable burden of this bad debt earlier, but it's also very current in the sense that this burden has only been realised now that so many of these loans have defaulted at the same time. It was also possibly bad management of business risk on the part of the lenders to assume that they could pass this burden on to the bankruptcy courts indefinitely.

Bankruptcy used to have a terrible stigma attached to it, and cripple the bankrupt financially for years to come. In recent years it's come to be seen as almost an easy way out if you've got too much debt. Remember those students who wrote off their student loans by declaring bankruptcy on graduation?

It's not entirely a social phenomenon either, both Tory and Labour governments have consciously taken steps to reduce the burden of bankruptcy and make it easier to recover, and the numbers of people going bankrupt has risen accordingly, putting extra burden onto the courts. Long term it was somewhat naive to believe that the courts would continue to carry this burden indefinitely. Short term however it didn't really matter, and short term is exactly what people were thinking of when they were giving £5,000 credit cards at 25% APR to shop assistants in council housing.

I'm not saying it's ok to take on debts that you know you can't pay, but nor is it ok to make bad loans knowing that they will be bundled up with good loans, and dumping the external costs of failed collection on to a court system designed for something totally different.

[turbobloke]

AJS- possibly regretting a spot of devil's advocacy

[AJS-]

sleep envy said:

AJS- said:

A lot of these companies have spent the last 10 years cashing in on selling stupidly easy credit to vulnerable and simple people they knew wouldn't be able to pay it back.

yes, what we really need to do is protect the weak, wrap them up in cotton wool and protect them from themselves

I know, since we can't distinguish them from the rest of society why don't we have blanket legislation to stop people making their own choices and taking responsibility for their own life/actions

we can hand everything over to central govt and let them make all key decisions seeing as they know best and are doing such a fantastic job of steering us though this recession

Or to put it another way, reduce the burden of these poor choices on the rest of us by setting up the most efficient mechanisms possible for reaching the ultimate conclusion without need for expensive court cases.

How about debtors prisons, or selling them into bonded labour? How much would you get on the slave markets for an 18 stone doley with £12K in unsecured credit card debt?

[sleep envy]

AJS- said:

How about debtors prisons, or selling them into bonded labour? How much would you get on the slave markets for an 18 stone doley with £12K in unsecured credit card debt?

£1k a week so 3 months hard labour?

[AJS-]

turbobloke said:

AJS- possibly regretting a spot of devil's advocacy

Haha, nah, once it gets to page 32 of unrelenting abuse I'll start to regret it, until then, bring it on!

(But if I start sticking up for Brown in anyway, feel free to shoot me)

[sleep envy]

swerni said:

cynical, me yes.

you may be cynical but you're not wrong

[Cpn Jack Spanner]

Carpie said:

If you fall into this category:

Don't own a house, have not more than £300 in assets ( I am presuming they mean in the bank not including everything you own in the world) and have not more than £50 a month in 'disposable income' (which I presume means after paying for Sky, Sunny Delight and ciggies).

Then a .22 to the head would be more beneficial to the nation. Consider the organs given to the NHS as repayment of the loan.

This will just mean more people strive to meet these conditions (hiding money, deliberately losing their job) so they don't have to pay for the new Astra they couldn't afford but got anyway.

Now you're being silly. The human skull is actually pretty tough, and there is a fair chance a .22 won't even go through it. Best offer a free upgrade to something like a .38 Special.

[AJS-]

Cpn Jack Spanner said:

Carpie said:

If you fall into this category:

Don't own a house, have not more than £300 in assets ( I am presuming they mean in the bank not including everything you own in the world) and have not more than £50 a month in 'disposable income' (which I presume means after paying for Sky, Sunny Delight and ciggies).

Then a .22 to the head would be more beneficial to the nation. Consider the organs given to the NHS as repayment of the loan.

This will just mean more people strive to meet these conditions (hiding money, deliberately losing their job) so they don't have to pay for the new Astra they couldn't afford but got anyway.

Now you're being silly. The human skull is actually pretty tough, and there is a fair chance a .22 won't even go through it. Best offer a free upgrade to something like a .38 Special.

Go on, you know you really want a .45, make a 6" exit wound and stop a rhino at 20 paces, and they're not as expensive as you might think.

70% APR payable for life, your first born may be at risk if you don't keep up payments. AJS- is the trading name of Big Verne Guns and Pornbroking Ltd, Moscow, and debts are underwritten by a man in a pub who said it was a sure fire winner and nothing could go wrong. Probably

[AJS-]

sleep envy said:

AJS- said:

How about debtors prisons, or selling them into bonded labour? How much would you get on the slave markets for an 18 stone doley with £12K in unsecured credit card debt?

£1k a week so 3 months hard labour?

What would you have these people doing that is worth £1K a week? When a semi skilled Polish labourer will work his nuts off for £300 a week and pay tax on it, you're going to struggle to get this sort of value out of someone who has been claiming sickness benefit for 3 years as his bad back prevented him from being a social worker.

[paul26982]

AJS- said:

sleep envy said:

AJS- said:

How about debtors prisons, or selling them into bonded labour? How much would you get on the slave markets for an 18 stone doley with £12K in unsecured credit card debt?

£1k a week so 3 months hard labour?

What would you have these people doing that is worth £1K a week? When a semi skilled Polish labourer will work his nuts off for £300 a week and pay tax on it, you're going to struggle to get this sort of value out of someone who has been claiming sickness benefit for 3 years as his bad back prevented him from being a social worker.

id graft my nuts of for £300 a week, ive being out of work for 6 weeks now, that would do me nice and give my family alot of support, send the bdS BACK..........

[bluetone]

Cpn Jack Spanner said:

Carpie said:

If you fall into this category:

Don't own a house, have not more than £300 in assets ( I am presuming they mean in the bank not including everything you own in the world) and have not more than £50 a month in 'disposable income' (which I presume means after paying for Sky, Sunny Delight and ciggies).

Then a .22 to the head would be more beneficial to the nation. Consider the organs given to the NHS as repayment of the loan.

This will just mean more people strive to meet these conditions (hiding money, deliberately losing their job) so they don't have to pay for the new Astra they couldn't afford but got anyway.

Now you're being silly. The human skull is actually pretty tough, and there is a fair chance a .22 won't even go through it. Best offer a free upgrade to something like a .38 Special.

You need to go back to school on this one; a .22 at point blank/to the temple does penetrate but importantly does not then have sufficient energy to exit the head, hence the round bounces around the inside of the skull with fatal consequences (a-la Jill Dando). Also pretty quiet/discreet, not too messy.

[thehawk]

swerni said:

havoc said:

swerni said:

you see where this is going to lead.
No unsecured loans for under £15k.

Then all the tossers (see banking scam thread) will start moaning that it's not fair, the bank won't lend them any money.

It's called Karma

No. MOST people wouldn't dream of taking out a loan they couldn't afford, and would be horrified to have to default on a debt. But there are a few (increasing, but still I would hope a small minority) who DO take the piss...it is these that will abuse this rule the same way they've abused other rules.

And it is the 'most' group who will suffer as a result.


Try not to see the world in such black-and-white terms.

you are kidding aren't you?

The main reason the economy is in the state that it is in right now is people borrowing money they can't really afford

Irresponsible borrowers need irresponsible lenders. And this economic crisisvis far more complex than a few people borrowing on UK credit cards.

[havoc]

swerni said:

But this whole thing has come about from greed. Yes greed from the banks but also greed from the individuals.
How many will cry fowl as they have their houses repossessed and all they will have are memories of their holidays in Mexico and Thai land, pictures of the X5 and a jet ski with nowhere safe to keep it all paid for on cheap credit which they never considered how they would pay back

cynical, me yes.

You're conveniently forgetting all the hardworking people who've been suckered into this mess, or who've done nothing wrong except retire at the wrong time and seen their pension pot turn into dust before their eyes.

YOU said at the start of it all that "those bemoaning the banks would find karma coming back at them". And I've pointed out to you twice (three times now, all of which you've thus-far ignored!) that there are going to be a lot of innocent victims of this mess.


One final point - Goodwin - I rather hope someone DOES do him over. Such greed and arrogance needs to be addressed, especially as 'the establishment' will ensure that our justice system never gets around to it...

[King Herald]

swerni said:

you see where this is going to lead.
No unsecured loans for under £15k.

Then all the tossers (see banking scam thread) will start moaning that it's not fair, the bank won't lend them any money.

It's called Karma

You've seen through the gubberments new master plan already then?

If you can't afford to borrow, NOBODY WILL LEND YOU ANY MONEY.

[groucho]

havoc said:

swerni said:

But this whole thing has come about from greed. Yes greed from the banks but also greed from the individuals.
How many will cry fowl as they have their houses repossessed and all they will have are memories of their holidays in Mexico and Thai land, pictures of the X5 and a jet ski with nowhere safe to keep it all paid for on cheap credit which they never considered how they would pay back

cynical, me yes.

Yep, it's the chicken's fault alright.