A Bankruptcy Lawyer’s Take on Dave Ramsey


(upbeat music) – Hey everybody. John Skiba here from the
Consumer Warrior Project and from the Arizona Consumer Law Group. And in today’s video, I
wanted to talk a little bit about bankruptcy and Dave Ramsey. You know someone who deals with debt and people’s debt problems all day long, I often get asked what I
think about Dave Ramsey. And people actually think
there is some kind of tension (laughs) between the Dave Ramsey approach to dealing with debt and the way the bankruptcy
attorneys deal with debt. And a lot of people are surprised to hear that I am a big proponent of Dave Ramsey. I actually have a lot of his books all over my office. Because I think that it is
a great way to deal with it. And I can tell you that
Dave Ramsey and his company, they actually used to provide
some credit counseling classes that went along with
the bankruptcy process. When a person files for bankruptcy, they have to take two
credit counseling classes. One before they file for
bankruptcy and one after. And Dave’s company provided the
course that people completed after they filed for
bankruptcy that gave some tips and strategies on how to stay
out of debt going forward. And kind of a side issue,
it was kind of interesting. They wouldn’t provide the
classes prior to bankruptcy because they felt that it was
inconsistent with the message that Dave preaches on the
radio which is to try avoid bankruptcy if you can,
if it’s all possible. And as part of being a
provider of his courses, actually once a year, he
had a conference of sorts out in Tennessee, in
Nashville, at his headquarters where all these bankruptcy
lawyers that used his courses would come in and he would
talk to them and give training, different ideas on business management. And it was really cool cause
we got to go back there and see how the whole Dave Ramsey
headquarters works. We got to see him do his radio show live. And he even had a dinner that
he held at his house (laughs) in Nashville which was really
cool cause I got to go there and we’re having a dinner with him. And I remember standing out
on his back porch just talking to Dave Ramsey about his radio show and of course with being a bunch
bankruptcy attorneys there, the conversation came up as far as, you know, is he anti-bankruptcy? And I don’t believe that
he is anti-bankruptcy. And obviously, I don’t speak for him but his thought was look
sometimes it is necessary for people to file for bankruptcy. Here’s a picture (laughs) of me and Dave out at the headquarters. But you know what his thoughts
were is look bankruptcy for too many people is the first option. It’s the first thing they
think about when they want to get out of debt when
there are other ways you can get out of debt. Particularly through like
Financial Peace University and some of the different
you know the debt snowball. Things like that he is a proponent of. And I’m in agreement with that. The bankruptcy is not a
good fit for everyone. It’s not a good fit for a lot of people. There’s a lot of other
reasons even besides the fact that there’s programs like
the Dave Ramsey program. The Financial Peace University, which I’ve taken that class, by the way. Like I said, it’s something
where I try to instill a lot of those things
not only into my own life but into helping clients who
are dealing with debt problems. But there are certain times when bankruptcy is necessary. And I think even think Dave
Ramsey would agree with this because as a lot of people
know, Dave filed bankruptcy himself when he was a young
man and had lost his business. And he relayed that story to us when we were back there in Nashville. And the story was that
he had lost his company. He owed millions of
dollars and he had done his very best to pay everybody back. And he actually made incredible progress paying back millions of dollars. But everything was really leveraged and he had all these secured debts. And one of the creditors
was threatening to repossess some of the furniture that
they had in their home. And so he ended up having
to file for bankruptcy to stop that because once somebody files for bankruptcy, it stops collection. It stops repossession of
cars or foreclosure of homes or taking of furniture or
you know any of those things. So that’s why he did it
cause he had to stop it because the creditors had sued him. They got judgements and
now they were trying to levy on assets and repossess things. And that is really the
situation where I see where bankruptcy makes sense for most people. One of the areas is when
there is an emergency. When there is a foreclosure
sale that is pending. When your car is going to get repossessed. If your wages are being
garnished and you can’t even buy groceries because it’s
making things so tight. Bankruptcy is very powerful then because it stops the collections. It stops the garnishment. It
stops the foreclosure sale. Stops the repossession and
gives you some breathing time to kind of decide what it
is that you want to do. You can complete the bankruptcy
and eliminate the debts. Maybe a Chapter 13 bankruptcy
where you are restructuring things so that you can pay less but still pay something
toward your creditors. That’s probably the number
one area where I see where bankruptcy is a necessity if things have gotten that far. Second way is if there really is just no realistic options for repayment. And I see this a lot with medical bills. People who come in have just hundreds of thousands of
dollars of medical bills. I see it when there was
a business thats collapse where a business had a
lot of lines of credit and they were personally guaranteed. And there’s just simply no way
based upon the income level that those people have that
they are ever going to be able to get out of that situation. In those types of situations, bankruptcy can make quite a bit of sense. So, definitely a big fan of
Dave Ramsey, Dave Ramsey Show. I listen to it. My wife
is a big fan. (laughs) We’ve been to Financial Peace University. But I do think and I
think Dave would agree that there are situations where
definitely it is necessary. Bankruptcy doesn’t need
to be the first step that people take. Maybe compare their options. And I talk about those
options in my office when I meet with people for consultations. We discuss bankruptcy options
but we also go over the non-bankruptcy options that are out there. One of which being, you know, The Total Money Makeover
here with Dave Ramsey. So, if you want to learn more
about some of the approach that we take to dealing
with debt and debt problems, you can go over ConsumerWarrior.com. That’s where we have numerous articles and hundreds of videos that I’ve done. There’s an audio podcast. It
can give you some information on how to deal with
bankruptcy, debt settlement. We even deal with debt collection lawsuits which impacts a lot of families. Again ConsumerWarrior.com Thanks for watching.

44 comments on “A Bankruptcy Lawyer’s Take on Dave Ramsey”

  1. Viviana Heredia says:

    Is bankruptcy the best option when someone looses their home?

  2. Yeshai Vankurin says:

    Dave never explains why he places bankruptcy on par with divorce. I would be interested to know why.
    Paul in his writings does say to owe no man anything however credit reporting is a scam designed to implement social class. It is an ungodly endeavor by the power elite to keep the poor where they want us. Compounded interest and predatory loans are designed to fleece the poor as well.

    I have learned with enough ambition, anyone can have pretty much anything removed from their credit report without payment to a creditor so my question for Dave would be, "why?" Why not file bankruptcy and kick thieves where they belong?

    Does God want you to be robbed because you gave your word to thieves? As a former pastor and student of the Scriptures I say, no. He doesn't.

    Or is there perhaps a financial reason Dave has for telling people not to file?

    This I would like to know.

    I guess a more simple question is, you see these people who paid off the debt (many times from companies who use credit reporting to charge the poor more via APR) and they look happy on Dave's show. I think to myself "What did they get? A sticker for being a sucker?" In the bible everyone in Yisrael was given Jubilee. A time of debt forgiveness. And that was on legitimate, above the board debt. Not being screwed. But real debt. None of this compound interest crap.

    So if you can be released from the chains of predators trying to rob you, what benefit is their in paying a thief other than a "I got suckered and thieves think I'm a good boy now!" sticker?

  3. Becky Shell says:

    I don't believe in filing for bankruptcy in most cases.When you make a contract with someone it is your promise to pay them back.You are taking money from them.I feel if you have made the mess you need to clean it up.If you deal with the issue you will be less likely to repeat the mistakes.BUT ON THE OTHER HAND, someone can run up a half a million dollars in medical bills and could never be able to pay it back.So I think Dave is right about bankruptcy being on the same par as divorce use it when all other means have been exhausted.

  4. Brian Waller says:

    If you only knew how the banking cartel has screwed over the country. Most are clueless that the federal reserve single handily screws everyone over.

  5. Daniel Durbin says:

    Dude get to the point

  6. Matthew Garcia says:

    Id like to say that i like your approach. Many people choose sides and are aggresive towards protecting their view. Which you probably noticed in previous comments. I love listening to dave and i like how you shared your opinion without completely tearing up daves image. I respect that. And i agree with you. Ever case is very different and should be looked at as so. Some people might need it and some people might not.

  7. fat cat says:

    When banks will not work with you and they keep charging late fees on top of 28 percent interest yup you bet bankruptcy is the answer. Everyone got bailed out in 2008 except the little guy.these banks should have and could have done more to help the average struggling American at that time but didn't.

  8. fat cat says:

    Forget the baby steps.
    File chapter 13 or even 7 depending on your situation make your chapter 13 payments for a period of 3 to 5 years depending on your plan and be done with it.chapter 13 stays on your credit report in my state 7 years.chapter 7 stays for 10.most of the time it will take you longer to pay your total debt within that time.remember it will not wipe out all debt.such as student loans ,IRS and what not.let this be a lesson and live within your means and build an emergency fund.i am not a lawyer just an average joe.i am in no way knocking dave Ramsey and listen to him daily.the guy has a net worth of 50 plus million so he obviously knows a thing ot two.
    Good day.

  9. Who Cares says:

    Is it ad?

  10. Chris Barclay says:

    I don't understand these people …. They never talk about the other option of just doing NOTHING. If your debt is not secured….. just credit cards or anything else that's not secured….. ask yourself…what would happen if you just stop paying these things. I did exactly that 4 years ago on 7 credit cards. Did anyone sue me? NO. …. Is it still possible? Yes but unlikely. Since then I have been able to get one unsecured credit card (Mastercard) and 3 store cards that are all paid and in good standing, that's all I need. If I had done bankruptcy and went through all the expense and worthless bother of that procedure, it would be on my credit report for 10 years. I was able to cut that down to 7 years by doing nothing. In 7 years the old stuff will drop off and I will emerge with good credit. Is this for everyone? No! But if your back is to the wall and you have no choice except bankruptcy or this. What are your options? Do you really want your credit to stink for an extra 3 years? You probably are a person who should be on a cash basis anyway. I'm retired so there is no job they can get to. I rent, I have no house, just an apartment and I'm not looking for a new one. If you decide to do what I have done, make sure that you never give them any money, ….. it sets that 7 year clock back to zero if you do. Try to pay off one card so that you emerge with good credit and you won't have the stigma of bankruptcy. If asked "have you ever done bankruptcy" I can say no to that….. Dave can't

  11. Richard Hart says:

    If, the entire point is to be debt free and never using credit except maybe for a home, then what's the problem using bankruptcy off the bat? Your credit is already ruined and if you never buy a home, so what! Once you go through the system and see how the industry and court system screws you when your broke, your attitude changes about your entire response.

  12. JOEL PEACOCK says:

    I never need your service in 70 years …..because I watch my penneus

  13. working shlub says:

    i was close to filing bankruptcy and even met with a attorney..i then found dave and climbed out of it. it was the worse 2 years of my life trying to pay off the debt with overtime and side jobs etc…ill never forget it and never go back.

  14. Shawn Travels The World says:

    Pay your bills and don't over narrow.

  15. Freedom In A Budget says:

    I never knew he taught the classes for post bankruptcy! So awesome! Shows that he truly cares about helping people get back on their feet! Because of Dave Ramsey I am now debt free!

  16. Chris Wilson says:

    What's the point!

  17. passthetunaporfavor says:

    Why is it I feel raped every time I go to the doctor's office ?

  18. housingbubble1 says:

    In 1997 I was forced into BK. A “friend” scammed me out of large sum of money leaving me more than years salary in debt. IRS started garnishment proceedings as I had nothing but debt. Now many years later, no debt and financially solid. A lot in part to learning from Dave.

  19. zudemaster says:

    I personally think Dave Ramsey is full of shit. He gives out this cookie cutter one size fits all solution for everyones financial problems. The world just does not work that way. Regardless it is not my problem. Just pay your freaking bills on time people and don't go into debt. If you make $50,000 a year don't buy a million dollar home. There, i saved you the problem of buying Dave Ramseys book.

  20. John Defalque says:

    Credit Counseling Society helped me.I like Dave but being a commie I'm not big on his religion.

  21. Reader 66 says:

    Some good common sense words. Thank you.

  22. Michael Deneault says:

    And his name is John Skiba! ::plays The Time is Now::

  23. paul kieffer says:

    Breathing time??? Your an idiot. GET TO FUCKING WORK AND PAY OFF THE DEBT.

  24. Robert Boggs says:

    deperate need to stop a repo but no way to pay u . where can i go bankrupt online

  25. Robert Boggs says:

    Drowning repo is coming . gotta go bk now! hellp

  26. Don Legal says:

    …why would someone think bankruptcy is the first option, I doubt that. And this student loan debt is destroying people! Not only did the debt not help them, they need more education in different fields and no money to do it! Trap! Or be a ditch digger which is what these elites are trying to push the poor to and out of ever holding high level positions, so their sons and daughters get to rule…you guys are no help for the money power game…I am looking for millions…how do I grab that? Easily!

  27. qdllc says:

    Bankruptcy has its down sides. The key is if the debtor learns from the experience and learns to live debt free or at least be very selective and use credit responsibly.

    Some DO NOT learn from the experience and go right back into bad decision making. It’s more painful to work hard on a bare bone budget to pay your debts compared to filing in court and getting relief in a max of 5 years.

    I’d not fault someone for using bankruptcy. I’d fault them if they kept using it because they clearly didn’t learn from the experience.

  28. Books4LitSouls says:

    I don't know why he can't teach the before class that seems twisted

  29. Roger Evans says:

    Bankruptcy helped me purchase a single family home after 2 years from the discharge date. Without the bankruptcy, I would never had qualified to buy real estate.

  30. Warren Katz says:

    Trump should give the course.he is the king of bankruptcy.

  31. Mamiya Phan says:

    too wishy washy

  32. Sutterjack says:

    Thank you for your objective video even as your profession is bankruptcy –

  33. Jonathan Black says:

    Most of the people who call into the D.R. show considering bankruptcy are scared and overwhelmed with debt, but are not in a situation where bankruptcy would be necessary. I think it's great that your firm parallels D.R.'s message of using bankruptcy as a last resort and considering other options before taking that step.

  34. Krista Harmon says:

    Eleven years ago, my husband left. The children and I had only $75. I sold the house along with all it's contents except our beds, clothes and my car. We got divorced. I went back to work and then a new and serious problem arose: my son was diagnosed with multiple issues – he will be a life-long dependent.I had to quit my job. And then I started having problems with my heart, muscles, coordination and eye sight. I cannot drive a car any more. I have credit card debt from the marriage and student loans. I have stayed clear of any kind of debt in the last 11 years. I hate knowing that I owe money but I cannot figure another way to pay.

  35. Pooey says:

    Problem is houses and vehicles are overpriced, so they are traps, a setup for failure/debt collapse, and it's only after you've been hit/traumatized by debt that you really the CON GAME behind the fiat system…

  36. C D says:

    Dave Ramsey is giving bad advice to people that REALLY need to consider bankruptcy. Not eating out on an income of $50K annually while owing $200K of debt is a JOKE. You barely can keep up with the interest. Greedy banks are lending people loans to get overpriced $50K SUV's they can't afford, student loans for ridiculous degrees and unaffordable health insurance. The financial system want you to be a debt slave forever by loaning out their devalued, counterfeit money to enslave the masses. Ramsey isn't really helping people, they should be saving money to hire you.

  37. Gatorman says:

    Found Ramsey 3 years ago! My wife and i are now debt free and plan on early retirement!

  38. Holly Wilde says:

    When I graduated I had 35K in school loans, they have ballooned up to 46K while I’ve been struggling to pay off unsecured credit cards. That makes no sense, need to get rid of credit cards through bankruptcy now before school loans hit 50K.

  39. ak6781fan says:

    I can't stand Dave Ramsey. I can't stand somebody that arrogant. I've tried to listen to him but just can't do it. I heard a guy call him and say he was having financial problems and was getting a divorce all Dave Ramsey did was give him crap about not being a man and putting up with the marriage and not going to marriage counseling and wanting to get a divorce. I mean Dave Ramsey has no idea what they got married just like he has no idea at all he just so damn arrogant. Maybe it's a personal thing I just don't enjoy listening to people that are arrogant.

  40. Fundamentalist American. says:

    I wish we all could buy a bunch of stuff we can’t pay for……..

  41. princesslamour1985 says:

    I borrowed and spent $100k. Why wouldn't I pay it??

  42. LectronCircuits says:

    Bankruptcy can happen to anybody at any time. You could be going down the street (minding your own business) when all of the sudden (out of the blue), bankruptcy! Let's be careful out there. Cheers!

  43. FortNikitaBullion says:

    I don't think Ramsey is necessarily against the concept of bankruptcy. He just doesn't want to be the one to decide for one.

  44. FortNikitaBullion says:

    I think the last step before bankruptcy should be to negotiate with your creditors and threaten the possibility of bankruptcy.

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