There is the well-known proverb that, to a carpenter everything in the world looks like a nail. Or, surgeons want to operate to cure any and all ailments. The same is applicable to some bankruptcy attorneys. I assisted a couple with asset protection last year. The couple faced joint liability from a failing business investment. They had $150,000 liquid cash, and they were expecting another $200,000 from the proceeds of a real estate sale. I explained that they would lose the cash in bankruptcy. I advised them to spend down the cash and possibly invest in a new homestead which would be exempt I they were sued.
Since my advice, the creditor sued and obtained a judgment against the couple. The couple too al their liquid cash remaining, about $310,000, about bought a $400,000 homestead with a small mortgage.
Car-title lending, where the owner of a car uses his/her car title as collateral to receive a loan, will become illegal in Wisconsin and will face new regulations in Virginia later this year. Already, Illinois has capped car-title loans at $4,000 and has hit the industry with numerous restrictions. Car-title loans, which are shorter and much more expensive than a typical auto loan, are offered as one-month loans of up to half the value of the borrower’s vehicle. But the reality is that few borrowers are able to repay the loan in just one month, what usually happens is that the borrower extends the car-title loan for several months and many of those borrowers eventually slip behind on their payments and lose their vehicle to the car-title lender. Jus
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