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May 08, 2008
Loans
I think that loans are a good idea, but also a horrible situation to have to need one. It is a means to an end, but no one really uses loans like they were meant to be. I do not think many people take out loans with the intention of paying it in full. They either refinance, buy something different, or sell it. You can get loans for just about anything now. Loans for college, homes, cars, furniture, medical and dental bills, boat and rvs, even credit cards are loans. Now that I think of it, we pretty much live off of loans! Now that is scary. I guess loans are better than leases, at least you have collateral and equity in whatever you take a loan out for. Too bad loans aren’t more like bartering. Like you could trade something for whatever you wanted…We got screwed on cosigning a loan, using our own savings as collateral. Of course, my dad said nothing would happen, and we believed him. Of course, we defaulted on the loan and were stuck with it, not him. Even though it was in the companys name, we had to guarantee it, so we were ultimately responsible. We ended up having to file bankruptcy because even the savings we guaranteed it with was not enough to pay it. It sucked. At the time, bankruptcy stayed on your credit for 7 years, then they changed to 10 years. So we are still waiting to be out from under that word! We have great credit otherwise. It is just having the word bankruptcy on your credit report that people don’t like. I have heard it is getting increasingly difficult to even file bankruptcy. I think people have that in the back of their head, that if things ever get really bad, they can always file. But the government is making that more difficult. I do not think there is even a chapter that you can file now that wipes everything clean anymore. It is all restructuring and paying it back over time. Which is good in most situations, but it would have sucked badly if that was our case. Just hope you never get in that situation.
Posted by juliusp at May 8, 2008 11:00 AM