So David Lardner bought a 2005 Volvo Station Wagon for $3,900 at auction. Pretty good deal? Looks that way, but he didn’t know for sure until he brought his car past a trusted mechanic.

After spending $170, David saw that his car only needed an oil change and air filter, a pretty spectacular outcome, really, for a car bought practically sight unseen.

Turning this high mileage Volvo into his daily drive brought a little more adventure than he was really ready for. He was doing ok until the third day when the transmission would not move into park. This made David very nervous because that could have meant the transmission was bad or that the specific part that would not allow the car to shift to or from park without pressing on the brake could be bad. That’s not as expensive a repair as a transmission, but still costly.

Upon inspection David noticed that a broken piece of plastic was getting in the way of the shift lever. With just a little elbow grease and a pair of vice-grips, he was able to move the shifter freely for a huge relief.

This is an example of how frightening it can be to buy an auction vehicle. Had the transmission been bad, that would likely mean that this particular car could not survive on the road. Serious warning: had this happened to someone less mechanically inclined, this simple problem may have resulted in unnecessary towing and repair costs.

Here are David Lardner’s 6 tips to remember if you want to buy an auction vehicle:

Before embarking on this adventure, make sure you have the following items on your checklist:

• Be very mechanically inclined (in regards to automobiles) or have someone who you trust with you.
• Set a budget and remember to figure in buyer’s fees and tax/tag/title
• If previews are online, look at them closely. Many times VINs are included so you can run a CarFax or AutoCheck well in advance.
• Show up a few hours early so you can inspect the cars you decide to bid on.
• Show discipline. Know ahead of time and stick to the maximum that you would pay for each of the cars you decide to bid on.
• Be realistic. You are buying a car that will likely need, at very least, a complete servicing, and perhaps much more.

Feeling brave? Check out the final segment of David Lardner’s adventure in buying a car at auction, and then make up your own mind whether this makes sense for you. https://clark.com/cars/buying-car-auction-life-5000-vehicle.

P.S. When you file Chapter 7 there are special rules you need to follow in order to keep your car. Take a look at my video

The post Buying a Car At Auction – Life With a $5,000 Vehicle appeared first on Baltimore Bankruptcy Lawyer.

For David Lardner, he had low standards for his $5,000 car, but there were standards:

• Find a car that was less than ten years old and
• Had four matching tires with reasonable tread life left.
• All the lights functioning and with
• Little in the way of body damage

Having access to the vehicle identification number (VIN) allowed Clark to run reports like CarFax and AutoCheck on promising vehicles.  But, just because the online reports might be clean doesn’t mean much if the car was damaged and fixed outside of using insurance. Self-pay repairs often don’t make it to those services.

After a couple of hours searching through the acres of available cars, Clark chose three cars that passed his tests, looked ok, and were likely to come in under his budget of $5,000.  But that wasn’t his real number:

There were additional costs that auction buyers have to consider when going to an auction: fees, taxes, and tag and title charges, to name just a few.  Plus, he intended to pay with a credit ccard for the protections offered by the credit card companies, and the auction houses add in a 2% up-charge.  That meant his bid was capped at about $4,000.

By the time he was done, he found a car that matched his standards for about $3,900. But the big takeaway from his experience was that it’s critical to know what you’re doing or bring someone who does. If you don’t you could find yourself worse off than before.

Check back next time to see how David Lardner’s auction vehicle worked in the real world.

P.S. Did you know that sometimes you can sharply reduce the amount of your car payment in Chapter 13? To find out more take a look at my video,

The post Buying a Car At Auction – Choosing a car at Auction: Needle in a haystack appeared first on Baltimore Bankruptcy Lawyer.

What is an auction?

A great money saver/deal blog, Clark.com, has written a 3 part series about the blogger’s experience buying a car at an auction for less than $5,000. Here’s the link: http://clark.com/cars/buying-car-auction-frugal-or-foolish/

According to Clark, Dealer auctions are limited to those who hold dealer’s licenses so an average consumer can’t purchase there.  The cars in these dealer auctions are usually in good enough condition where they can be placed in the used car inventories of new car dealers.

Meanwhile, public auctions are open for anyone to attend and buy from.  There is a mix of lower-end buy here/pay here dealers and consumers milling about inspecting the cars.  These are where the least expensive and the most potentially troublesome cars get sold.

Just about every metropolitan area has numerous auctions taking place every week.  These auctions usually offer high mileage, heavily used and sometimes damaged cars.

Each auction has its own rules.  There are some auctions where the rules allow you to preview the vehicles up for sale and test-drive them.  There are some that don’t allow test drives, but will allow you to start the car and inspect them.  Taking them to a mechanic for a proper inspection is pretty much impossible.

The Auction Goal

Clark’s goal was to find reliable transportation for less than $5,000 that he could put into service with less than $500 in repairs.  He was hoping this car would be “decent looking” though reliability was of the utmost importance.

Because he was (and you are probably) not a dealer, Clark had to attend the public auctions to find suitable transportation.  And, because auctions are generally the last time a car gets sold on the open market prior to going to the junk-yard, the risks of purchasing there are huge.

Check back next week to find out what Clark bought and what challenges he’ll face trying to make do with as inexpensive a car as possible.

Happy shopping!

Ron Drescher

P.S. While we’re on the subject of cars, many of my clients want to know if they can buy a car in Chapter 13. The short answer is “yes”, but the longer answer is always more complicated, as I discuss in this video, Can I Buy A New Car In Chapter 13?

The post Buying a Car at Auction – Frugal or Foolish? appeared first on Baltimore Bankruptcy Lawyer.

If the credit card balance is just a little too high, then you’re going to use up years and years of your life getting to zero, getting to the point where you don’t have that debt. You know what? It’s your life. These are your years. This is the time that you have in your life to make the best that you can out of the opportunities that you have. If you’ve got debt that’s a little bit unmanageable, and you’re paying a credit card company, instead of paying yourself, I’m inviting you, in this book, to consider whether or not that’s a wise decision. File Bankruptcy and Get Rich is all about ridding yourself of this debt so that you can pay yourself in savings and in investment, instead of paying the credit card companies’ exorbitant interest rates. Katherine: I know we need to pick up a copy of the book, and you’re going to tell us, just a little bit, how to get a copy of that book. Give us one example from your book that talks about how we can save money. Again, bankruptcy and getting rich, saving money, seems like it shouldn’t go together, but you’re showing us masterfully that it does. What’s one example from the book that you illustrate? Ron: The first example that I illustrate is the one that I just discussed with you, and I’m happy to dive a little deeper. You’ve got a credit card of $13,000, and you’re making minimum payments … I want to pull up exactly what’s going on … you’re making these minimum payments, and we’ve figured out that, over the course of 29 years, you’re going to end up paying … I have this table right here … if you make the minimum payment on a $13,000 balance, of $130, you’re going to end up paying $29,392 over 26 years, so it’s $16,000 more than the principal.

Let’s turn that around in a different way. Let’s say you take that same $130 minimum payment at the same 26 years, and let’s say you have a very conservative rate of return of 4%. The value, at the end of the 26 years, of that $130 investment is going to be $71,000. Basically, instead of paying $29,000 to the credit card company over 26 years, you’re going to have, in the bank, $71,000. schedule an appointment Katherine: Wow. Ron: In 26 years, you’ll be $71,000 ahead if you file bankruptcy to get rid of that $13,000 in credit card debt, but continue to pay the $130. Katherine: I see. Ron: If you don’t pay the $130 a month to yourself, you’re not going to get rich. The bankruptcy doesn’t get you rich, but the bankruptcy creates that initial momentum so that you can pay yourself, instead of paying the credit card companies, and that’s probably the most ironclad example of how this process works because I do assume that you’re going to do everything you can to get out of debt. Let’s talk about a second situation.

Let’s talk about wage garnishments. Wage garnishments are horrible things because what they’re doing is, they’re not even giving you the opportunity to consider who you’re going to pay, and how are you going to pay it. They’re just reaching into your paycheck, and they’re grabbing 25% of the net, and it doesn’t matter if you’ve got a mortgage, and it doesn’t matter if you’ve got rent to pay, and it doesn’t matter if you’ve got a car loan. Really, they’re reaching into your paycheck, and they’re grabbing 25%. Katherine: That hurts. Yeah. Ron: That really does hurt, and it’s humiliating, and it’s debilitating. I urge my clients to never allow themselves to be in that position. There are at least two good alternatives; one is a Chapter 7 bankruptcy, which, if you qualify, will just wipe away the debt. Even if you have to be in a Chapter 13 bankruptcy, which requires a monthly payment plan to the trustee before you get your bankruptcy discharge, at the very least, you then get to deduct your rent, and deduct your car payment, and deduct your child support or domestic support obligation, and deduct the amounts of money you have to pay for food, and the amounts of money that you have to pay for your car insurance, and the amount of money that you pay for your cable bill. You deduct that before the creditor gets the first dime. That’s even a much better solution than the garnishment. Does that get your rich? No, that’s not going to get your rich, but at least you know that you’re paying yourself your normal monthly expenses before the money is being taken from you by that judgment creditor. Katherine: Yeah. That’s a tough thing. You’re right, it is debilitating. Even if we weren’t filing bankruptcy, anybody has ever had their check come up short or expected money to come in, and it didn’t come in, in the time in which you needed it that, in itself, is debilitating. Just imagine you have Uncle Sam come in and just get what they feel like is theirs, and too bad, you can’t do anything about it. If you don’t take the steps, you’re just so helpless. Ron: Now … schedule an appointment Katherine: I’m just listening to you, and I’m thinking, “Yeah, that cringe of …” Go ahead Ron: Here’s an amazing thing about bankruptcy in garnishments that … You read on the internet, “The five things about weight loss they don’t want you to know,” I’m going to give you the one thing about wage garnishment that they don’t want you to know, that the creditors do not want you to know. All right? Katherine: Okay. I’m ready for it. Ron: That is, you file bankruptcy, and you can get back all of the money that was garnished from the creditors within the 90 days before you filed the bankruptcy. Katherine: Really? Ron: Yes. Katherine: Wow. Ron: Yes, that’s right. Katherine: See, I did not know that. See, you can tell from me talking I didn’t know that. That was a bonus for today. I didn’t see that coming at all. Ron: It’s a huge benefit. Katherine: We’re talking with Attorney Ronald Drescher about his book, File Bankruptcy and Get Rich. This guide helps you see your way past money troubles to get on the road to building wealth, and he’s given us two excellent examples, and then he threw in a bonus, so we’re going to say three. Ron, how do they a copy of your book? Ron: The best, quickest, easiest way, I’m going to give you a telephone number right now, 443-438-1966. Dial that number, ask for Nicky, and ask for a copy of File Bankruptcy and Get Rich. We’ll send it right out to you. Katherine: Awesome. I’m going to say thank you, again, for being a part of This Needs to be Said, and thank you for teaching us more about bankruptcy. Until next time, have a wonderful day. Ron: Thank you very much. Had a great time. schedule an appointment

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My name is Ron Drescher; I’m an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania, and Virginia and today I want to correct a mistake that a made in a different video. I was on the streets of Paris and I was excited to talk about the five reasons that you might have to file a Chapter 13 case and I recently discovered at least a couple more reasons. There’s a sixth reason and that might be because you want to lien strip a completely unsecured junior mortgage against your property. You can do that if the property is not secured by even a dollar’s worth of value. What happens is you get a valuation for the property, it could be an appraisal, it could be a broker’s price opinion, it could even be just your own opinion of value and then you show how much you owe to the first priority senior mortgage or deed of trust and if the amount that you owe on that senior deed of trust is higher than the value of the property if you have a junior mortgage or junior lien you can strip that off, even if it’s a consensual mortgage. You can’t do that in Chapter 7, but you can do it in Chapter 13 and it is a reason why many of my clients do choose to file for Chapter 13. My name is Ron Drescher; I’m an attorney practicing bankruptcy and creditor’s rights and if you have a question about whether Chapter 13 is a good remedy for your problem please pick up the phone and call me. I would love to hear from you.

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My name is Ron Drescher. I am an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania and Virginia, and recently I did a series of videos on the streets of Paris about five reasons why you might want to file for Chapter 13, but since then I came up with another couple of reasons and here is the seventh reason why you might want to file Chapter 13 and it might be because you don’t qualify for a discharge under Chapter 7 but you do qualify under Chapter 13. The rule is, if you have done a Chapter 7 within the last 4 years, after the 4 years pass, you can file a Chapter 13 case and get a discharge in that case as long as you pay overall of your net disposable income during the applicable time period of the 36 up to 60 months. This could be extremely helpful if things haven’t gone your way since you received your Chapter 7 discharge. So that is the seventh, and as far as I’m concerned, the last reason why you may want to file a Chapter 13 case. My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights and if you have a question about whether Chapter 13 is right for you, please pick up the phone and call me. I would love to hear from you.

The post Discharge appeared first on Baltimore Bankruptcy Lawyer.

My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania and Virginia. Today I want to talk about another reason why you may want to consider filing Chapter 13 bankruptcy. Sometimes you fall behind on your mortgage payments and you can’t work a loan modification. When that happens, you have the opportunity in Chapter 13 to cure the arrears over the life of your plan. That’s usually 36 to 60 months. You make your normal monthly payments to the lender and you make a cure payment to the Chapter 13 trustee who, in turn, makes that payment with interest at a normal market rate, let’s say 5%, to the lender and then at the end of your plan, let’s say 60 months, you’ve caught up your mortgage, you’ve discharged all of your debts and you’re ready to resume your fresh start. Chapter 13 is usually your last best hope to save your home, if you’ve been denied a loan modification. My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights and if you have a question about how you can use Chapter 13 to save your home, please pick up the phone and call me. I would love to hear from you.

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My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania and Virginia and today I want to talk about another reason why you may file Chapter 13 and it may just be because you don’t qualify for Chapter 7 because your family income is above the median income of a family for your size in your state. When that happens, you’re going to have to fill out what’s called the long form to talk about your secure debt, your tax debt, your health insurance and other expenses that are going to be deducted from your monthly income. After we do that, we’ll see it’s possible you still may qualify for Chapter 7 but if not, then you’re going to have to file the Chapter 13 case and pay over that net disposable income every month to the Chapter 13 trustee for 60 months. At the end of that 60 months, you’re going to be discharged of all of your debt and that’s really the primary benefit for filing the Chapter 13 case for you. My name is Ron Drescher. I’m an attorney practicing bankruptcy ad creditor’s rights and if your income is above the median income for your state, please pick up the phone and call me. I would love to hear from you.

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Chapter 13 Equity

My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights in Maryland, Delaware, Pennsylvania and Virginia. And today, I want to answer the question why would you file a Chapter 13 case. There are five reasons; I’m going to answer the first one right now, which is about equity. Sometimes your assets just have too much value, and if you were to file a Chapter 7 case, then the trustee would sell your assets, and you would lose them. Chapter 13 gives you the opportunity, if the price isn’t too high, to buy back the value of your assets from your creditors over a 60‑month plan. That makes it more affordable and more reasonable for you to maintain your assets while you reorganize your debts and get the relief that bankruptcy provides. My name is Ron Drescher. I’m an attorney practicing bankruptcy and creditor’s rights. And if you have a question about whether you qualify for Chapter 13, please pick up the phone and call me. I would love to hear from you.

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My name is Ron Drescher. I’m an attorney practicing Bankruptcy and Creditor’s Rights in Maryland, Delaware, Pennsylvania, and Virginia; and today I want to talk about another reason to file Chapter 13 and it might be because you have a debt that’s not dischargeable in Chapter 7. Two perfect examples of that are debts when you pay your taxes by credit card or a debt that might arise if you have an intentional harm against the property of another. So for example, if you use your credit cards to pay taxes, that’s not dischargeable in Chapter 7; but it would be dischargeable if you completed a course in Chapter 7. But it would be dischargeable if you completed a course in Chapter 13, either 36 to 60 months. Similarly let’s say you do something intentional that causes harm to the property of another. If you complete the course of payments in Chapter 13, you’ll discharge that debt; that would be non‑dischargeable in Chapter 7. Now there isn’t a lot of application of these two reasons for filing Chapter 13, but it is good to know just in case something like that does come up for you. My name is Ron Drescher. I’m an attorney practicing Bankruptcy and Creditor’s Rights and if you have a question about whether you can discharge a debt in Chapter 13 please pick up the phone and call me. I would love to hear from you.

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