just on the subject of bankruptcy, in the UK, the one debt that cannot be 'erased', via bankruptcy, is student loan debt. I had a friend who went bankrupt and she was still paying that off, at something like £50 a month. Initially, the rules are that you don't have to pay it back till you hit a certain income bracket (and if you never reached it, you didn't pay it back - not sure if that's still in effect). And this was when the majority of people i knew were racking up about £3,000 a year (accommodation, tuition, extras) - at the most.
Now it's anything up to £9,000 a year (that took 4 years) - this is according to the maximum banks are now offering as loans to students. I saw an advertisement for it the other day...
From personal experience, it was probably one of the best decisions i ever made. Once you've declared bankruptcy, the limits on the person are: they cannot be a financial controller of a company, a director; your bank account may be frozen at the most basic for up to 6 years, but you can be 'discharged' sooner, ie able to build up your credit, because of this obtaining a mortgage or other securities may be difficult or prohibitively expensive; and if you are working, there is always the possibility they will attempt to have you 'negotiate' with your creditors.
This was back in January 2008 and i was number 500 and something of that year who had been processed. Ironically it costs about £400 to 'process' you - an amount i hadn't ever spent prior to doing it!
You're made to go in front of an adjudicator and explain your reasons and they're very understanding, but i was lucky to have had a guide who not only suggested it, but advised on how to navigate the bureaucracy. And strangely enough, her black cab boyfriend was the originator of the idea and he said he had a feeling something was going to happen to the banks, thus possibly making it more difficult to do in the future - this wasn't the case, but he was right about the banks.
it is the social stigma created by overlord creditor banks and financial institutions that make it emotional and psychologically difficult to do.
This is so true. Even if it wouldn't affect them or their future plans, i know many people who could benefit, who wouldn't 'dare'. Were the world constructed as the mainstream thinks it is, perhaps the stigma may be justified, but it isn't.
I was discharged in less than a year and never even dreamed of borrowing another penny. I did it in the first place because my jobs were always very low paid (creative industries) and the areas i had chosen to live were beginning to be gentrified, so costs began to soar. I can't say i haven't worked the system to my advantage where possible, but this was after the fact. It coincided with many changes my life, particularly the idea of opting out of something i never believed in. There were many others in my position; many had other options where money was concerned, or they identified with their jobs and just saw it as the sacrifice you have to make; and for me, the sacrifice was too great. Added: And those who couldn't pay it off, are still paying it off; at least 10 years on.
Afterward, i was able to imagine what i could do, where i could go. I began to dream of working abroad, travelling, even just dropping out till i had a better idea of what i wanted to do. Whereas before, the spectre of brown envelopes (bills) and bailiffs literally terrorised me daily. I've never been that good with money, growing up it was a huge issue, but in reality, for what i wanted to 'achieve', from where i came from, with the knowledge i had at the time, it was one of the few options. I got my first loan for £3,000 at 18.
I can only imagine the relief those recipients of such kindness feel. But i do remember when this was first reported back during occupy. I wasn't sure it was such a great idea at first, because it felt like another way of justifying and supporting the very dictators who coerced you in the first place, but, i can see how it is actually turning the system against itself. As well it being as an empathic message that is harder for the RWA's to dispute.
Just my thoughts and experiences.
