Why Americans are prone to bankruptcy

　　In his 2009 State of the Union address, Obama noted that every 30 seconds an American goes bankrupt because of medical bills, and more than a million people go bankrupt a year.
What is the experience of bankruptcy

　　If an American still doesn’t pay, the hospital may sell his bill to a third-party loan collection company, and the loan collection company harasses the person every day. This scenario appeared in the American drama “Basic Deduction”.
　　When a person receives all kinds of threatening calls every day, it is really unbearable, but when he still has no money, he can go to the court to file for bankruptcy. There are two types of bankruptcy, one is “Chapter VII Bankruptcy”, that is, according to Chapter VII of the “Bankruptcy Law”, except for student loans and child support expenses, which are not exempted for you, the others are directly exempted, but there is a premise. , your income is lower than the local median.
　　Of course, when you file for bankruptcy, the person who lent you the money will also be there. If people do not agree with your bankruptcy, you have to go through bankruptcy procedures in accordance with “Chapter 13 Bankruptcy”. In other words, your income is not low, and you cannot directly forgive the debt. After filing this bankruptcy, the person who lent you the money can no longer harass you, but you have to promise to pay it back within a few years.
　　70% of the bankruptcy filings in the United States are “Chapter VII bankruptcy”, that is to say, most of them are low-income earners. After bankruptcy, all the assets in the person’s name will be liquidated, except for his pets, which will be left to him, the deposits will be used to pay off debts, and other houses, cars, etc. may be auctioned (of course, the house may be left to him according to local state laws. ), the auction money is returned to the debtor.
　　When people go to the United States, they often see those homeless people setting up a tent on the street, making the whole street a mess. Homeless people are not necessarily bankrupt, but bankrupt people can easily become homeless.
　　After the bankruptcy filing is successful, the next seven years will encounter these troubles: limit high consumption, only maintain some basic living needs, and use the extra part of the money earned every year to pay off debts. Almost say goodbye to credit life, can not take loans, can not apply for credit cards. More than half of the reputation has been ruined. Bankruptcy is not a matter of personal privacy. It can be found on the Internet. Subsequent job search and renting will be affected.
　　You may be wondering, have you lived a normal life after seven years without paying back the money, have you considered the feelings of those who are owed money? I also had this kind of confusion. Later, I asked a professional to ask. They said that the Americans have two considerations: first, if they owe money, they should not be beaten to death with a stick. It doesn’t make much sense. And because of the existence of this system, everyone will consider the risk of borrowing money. The United States emphasizes “self-responsibility”. If you lend money to people who may not be able to pay, you must reflect on your own problems. Americans really rarely lend each other money.
　　Secondly, and most importantly, bankruptcy has little room for ordinary people to operate. If you file for bankruptcy, you will often be unable to get along.
　　For those rich people, bankruptcy is another matter – the rich people in the United States will make their property into pieces, which are similar to the isolation warehouse of a cruise ship. If one piece explodes, it will not affect the other. The bankruptcy system is a tool for some people to protect property. For them, the bankruptcy system is almost a legal loophole.
　　The bankruptcy system combined with the foundation system is simply a spectacle in the history of human law – you “donate” all the money in your name to a foundation that does not belong to you, and then one day you go bankrupt and return You can continue to mix with the funds of the foundation, the foundation is your piggy bank.
consumer bankruptcy

　　Almost all households in the United States have overdrafts every month, not only monthly overdrafts, but also spending ahead of time. Once the monthly salary is paid, almost all the various bills are paid, and this month, they will live on credit cards.
　　In 2016, Linda wrote an article about a basic fact of American society: Nearly two-thirds of Americans can’t come up with a $1,000 emergency. For this, I actually asked a few Americans, and they told me they didn’t have $1,000, and neither did the people around them — nor did the vast majority of households. But this has nothing to do with income.
　　I asked them why they maintain such a unique view of consumption. A Chinese-American said that Americans have been peaceful for a long time and have not experienced much hardship, so they are naturally optimistic about the future.
　　Of course, using a credit card is not a problem, the problem is the installment.
　　An American professor said on a video website that the root cause of Americans’ economic pain is poor mathematics, and they can’t calculate the loan interest rate of credit card installments. He also praised the Chinese, saying that the Chinese are good at math and can calculate clearly, so the Chinese do not like to install credit cards. In fact, this is a misunderstanding of us. First of all, Chinese young people are really interested in credit cards, but young people use Huabei a lot; secondly, I have never seen a few people who can understand the instalment interest rate, because the algorithm is very complicated.
　　The vast majority of the American people swipe their cards whenever they disagree. After brushing, I remembered that I might not be able to pay this month’s bill next month, so I decided to install it and prepare to pay it back slowly. An instalment may not be obvious, but it will be different if you have more stuff, and you will gradually be unable to make ends meet. Anyway, your monthly salary is returned to the bank, and you can only rely on credit cards for life. If you buy a large item, you will have to install it in installments. After the installment, you will have no money, and you will get deeper and deeper.
　　If a person is not unemployed, the monthly tension point is generally not a problem, but once unemployed, the trouble will be big. During the U.S. economic crisis in 2008, millions of American families filed for bankruptcy overnight, often because they couldn’t pay with credit cards—many people owed a lot of money, their cash flow was broken, and they couldn’t carry it any longer.
　　We said above that when you file for bankruptcy, creditors will be there, and if they don’t agree, you can’t forgive the debt. But credit card companies generally agree, because they have already taken this part of the default rate into account when they issue cards, and such high interest rates themselves reserve room for default.
　　In addition to medical and credit card overdrafts that cause Americans to go bankrupt, mortgage and student loans are also an important reason for Americans to go bankrupt. Mortgage loans are easy to understand, and student loans lead to bankruptcy, we seem to understand. If you have been in contact with Americans, you will find that their student loans are much larger than ours. You know, education in China should be the cheapest in the world.