Michael Vick is out of money

I've said on here before that if Vick were smart -- and given his other choices, that is seriously open to question -- he would have been dumping cash into the Caymans or Switzerland long before any of this crap came out. But he appears to have always thought he was bullet proof.

 

Chapter 7 means everything you own is liquidated, with the proceeds going to the creditors.

Chapter 11 means you - well, the lawyers on both sides - work out a repayment plan, usually paying back somewhere between $.10 to $.50 on the dollar.

 

Yeah. He has my sympathy.

 

They say Chapter 11 is a little less of a blow on your credit report (obviously it is relative) but the bottom line is this -- I've had friends who did 11 and it didn't improve their situation because they still had to make payments -- and while they are usually pennies on the dollar- - when you have a hundred thousand in debt (I'm talking average working person, not the millionaires who think it is monopoly money) you are still trying to pay off a big portion of it.

However, a few years ago when my sister's loser ex left her with three kids and no education (she is a stay at home mom) or means of income and then she found out she had a bunch of credit lines and cards opened in her name by him --- she looked at the options and decided she needed to do a 7.

We all pitched in, helped her pay for the attorney's fee, which was about $1000 -- and the lawyer filed the paperwork for her (which through some non-profit for single moms we were able to get about half the lawyer's fee paid for) and she basically made about $90,000 in debt totally disappear.

The good news for her was she had no debt, no bills hanging over her head and nobody calling the house every day. She was able to get into a program for single mom's that helped her pay for an education at a tech school and she got a job in medical billing and then got a job.

(as an aside loser ex moved away to a different state but couldn't run and hide from child support and now his wages are being garnished at a much higher level than he would have had to pay had he just went to court because he owes her back child support.)

The bad news was obviously that she was saddled with bad credit for at least seven years (though there are actually several programs she's found to help her improve her credit rating every six months through making good on her payments. In fact, she was just approved for her first car loan since the whole debacle and her interest rate -- 11.5 -- while not outstanding is still worlds better than the 17 or 18 percent interest rates she was being quoted last year when she was trying to buy a new car) but at least she had peace of mind to know that she was essentially starting over.

Had she done an 11 -- she'd have had an extra $300 or $400 a month going out the door to pay a bill of $25,000 or so, which in her situation might as well been a million.

Of course, this is a different situation than Vick's but it is an example of how a chapter 7 can be something useful if used properly.

 

Wow, zag.

Very informative.

Thanks.

 

As soon as he's out of prison, Mike's building a cockfighting ring in his backyard.

 

Come on, somebody had to do it.