Judge takes Congress to task in bankruptcy case

Austin American Statesman ^ | February 5, 2006 | Robert Elder

[kms61]

FREDERICKSBURG — Alfonso Sosa, a house painter here who made about $20,000 last year, filed for bankruptcy the morning of Dec. 6, hoping to avoid the foreclosure on his family's mobile home scheduled for later that day. Judge Frank Monroe of Austin rejected the case 16 days later — with a bang.

In his ruling, Monroe said the new federal bankruptcy law is full of traps for consumers, calling some of its provisions "inane," "absurd" and incomprehensible to "any rational human being."

He stopped just short of accusing Congress of being bought and paid for, dryly noting, "Apparently, it is not the individual consumers of this country that make the donations to the members of Congress that allow them to be elected and re-elected and re-elected and re-elected."

[cva66snipe]

One hard hit with a catastrophic illness especially if you are blue collar can wipe you out and leave you very deep in debt. The situation you mentioned somewhat happened to us. A hospital transfer occurred and the insurance company considered it a medical release. We got the good news a few months later when the 6 figure bill came due from the second hospital. We took full bankruptcy. Credit Counseling would not have changed our situation a bit and would have been more of a hardship to contend with under the circumstances. The news laws look more like corporate welfare than any thing else.

We were lucky the second time when I became disabled as I did not require hospitalization. Bad things happen to people. It is morally right to excuse such types of debt.

[djf]

Hey, they repealed most of the usury laws. So now if a company want to charge twenty percent they can. And it has ALWAYS been part of the equation that some debts would remain uncollected, and interest/writeoffs would cover them.

But part of the reason usury laws should remain is to protect the lender as well. That way, only well backed lenders do the lending. And they do a better job of determining who is credit worthy than those who aren't.

If their expectation is that they can lend at 15-25 percent, not pay any attention at all to who they lend to, solicit new CC holders by the millions, then use the courts to pound their customers into debtors prison and bear no responsibility at all in the situation, well, sadly, they've succeeded.

[cva66snipe]

One other point to make here. The credit card companies in the past made it a practice to bombard persons who had filed and declared bankruptcy with their credit applications. Yes it's true just ask anyone who ever took it before these laws were passed. They were trying to shark persons who although were freed from their debt were still struggling to make ends meet. They knew they could not file again and would go after what ever the persons had left. It is a for of entrapment.

And as another poster said Major Corporations decide to bankrupt their companies and all they have to do is change their name. The ones who took the company to bankruptcy still get paid major salaries or if terminated very very generous severance pay.

[cva66snipe]

If their expectation is that they can lend at 15-25 percent, not pay any attention at all to who they lend to, solicit new CC holders by the millions, then use the courts to pound their customers into debtors prison and bear no responsibility at all in the situation, well, sadly, they've succeeded.

Yep it works both ways and the lenders brought much of it on themselves. But I'm not convinced they were losing that much to start with.

[Loud Mime]

I get this feeling that the congress did for bankruptcy what it did for lower cable rates.

[djf]

They weren't. That's why most of these major corporations are now banks. Or at least have a banking subsidiary. Why should they build something and have a profit margin in the single digits when they can make 15 percent as a lender?

[BlackbirdSST]

The government is not your mommy and daddy.

Ah, just the mommy and daddy of the Credit Card and Banking Industries, and any other big business that rolls them over. Blackbird.

[TheSpottedOwl]

Couple the new bk laws with the Kelo decision for a chilling reality check.

[gleeaikin]

Another thing credit card companies do is bombard young people with offers when they go to college, even though it is the parents who are sending them to school. It should be illegal to issue a credit card to a Dependent, unless the person responsible for their finances signs off on it.

[Adder]

"The government is not your mommy and daddy."

Nor is it the parents of the finance industry.
They sould be singing the "Responsibility, people, responsibility" mantra also.

[NoControllingLegalAuthority]

The government is not your mommy and daddy.

Sorry, even the Republican Party does not agree with you, pal. Politicians in both major political parties are rushing toward the "nanny state."

The massive agriculture bill George W. Bush signed is the greatest example of irresponsible nanny-ism ever created by government. How about the massive pork added to every major bill being passed? The government IS the big giveaway machine.

Not only is the U.S. government the "mommy and daddy" of corporate America, it is the nanny of every third world craphole country on Earth ....including the one now under control of the murdering terrorists of Hamas. I believe the U.S. government gave the Palestinians $400 million last year!

Debtors in the United States just happen to have nothing American politicans want so they get the royal screw job.

Now, if you live in Iraq, there is plenty of free American financial help to go around. I understand much of the American government's "rebuilding" money has been disbursed in cash....billions of it....IN CASH!

The U.S. government has plenty of free money to give everyone in the world except its own most unfortunate citizens.

In fact, most bankruptcies in America are the result of medical bills. Medical bills HAVE to be paid by American citizens but ironically, do not have to be paid by illegal aliens in America, guaranteed hospital care even if they cannot afford any.

That guarantee of free hospital care to illegals is BANKRUPTING MANY HOSPITALS in the Southwest United States. Are those hospitals also guilty of overusing credit cards, too?

[therut]

If you do not like the terms of your loan don't borrow the money. Citizens of this country are to irresponsible to use credit cards. They need to outlaw them as it is obvious citizens are not capable of using one responsibly. Anyone who uses a credit card for anything except emergencies or very small amounts is a fool. Some people need to be on a cash only basis. People use credit cards like free money. I agree minors should not get credit cards. I'm not for sure they can by themselves however. If our parents could make it through the Great Depression without all the so called free money anyone today should be able to control themselves. But apparently they can not. Some people sound like children

---

well I could not help it the mean ole credit card company seduced me into spending all that money I did not have.

[pinusstrobus]

My problem with this law is that the government got involved again. I am going to be affected by it. The mimimum payments are authorized to go up. We can make our payments now and add a little extra and pay off one at a time. Now, the minimums can double and we won't be able to make payments and will be forced to go bankrupt, if that is even possible under this law. So much for paying off one's obligations.

[Flifuss]

My favorite sign at the cash register - In God we Trust, all others pay in cash.

[MrLee]

Actually, he's pretty much "right on".

[SeeSalt]

"I believe the U.S. government gave the Palestinians $400 million last year!"



That is on top of the package of $5 billion US government gave each year to Israel, Egypt and Jordan.

[montag813]

He stopped just short of accusing Congress of being bought and paid for

Ok, I'll say it then: Congress was bought and paid for by MBNA. They are a bunch of whores.

[montag813]

Just wondering, has anyone seen the lower rates that were touted as a benefit of this law?

Bush himself proclaimed those "lower rates" when he signed the bill. Where are they?

[montag813]

And they weren't ducking their debts actually. It was a Chapter 13 debt restructuring.

\ The Judge denied a Chapter 13 plan? In only 2 weeks? Things are really bad out there.

[INSENSITIVE GUY]

This bankruptcy law was passed in preliminary fashion to compliment the newly invoked law to scr*w those who owe the credit card companies.Most people were barely able to pay their monthly statements and now will be forced into bankruptcy only to find out the new bankruptcy law will put them in the streets.The cc companies will simply take a right off.This i think will backfire in time though.The republicans are really stupid and should realize the number of votes is always greater than the dollars pumped into their campaigns.