Beating Broke

Personal Finance from the Broke Perspective

Covering the Costs of a Car Accident When You’re Broke

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As life would have it, you’ve just been involved in a serious accident. To top it all off, you’ve sustained injuries that will certainly keep you out of work for some time. You’re already strapped for cash, so you’re probably freaking out about how you’re going to survive the next couple of months (or years). Before you add tension to an already stressful situation (and prolonging your healing process), you should know that there are ways to manage – even if you’re broke.

Costs of a Car Accident

Not many people consider the true cost of a car accident. Outside of possibly paying an insurance deductible, you could also be responsible for repairs, medical bills, and medical-related expenses (i.e. co-pays or medical supplies). There’s also the added fact that you’re not able to work until you get clearance from your doctor. This leaves you hemorrhaging money that could result in you not being able to pay your regular bills. Ultimately, knowing where to turn in times of a financial crisis such as this is key to your survival.

Hire an Attorney

If you believe the accident wasn’t your fault, you should consult an accident attorney immediately to discuss your case. If there is sufficient evidence that you were not the at-fault party, a trained attorney may be able to use this information to help you get a considerable settlement from the insurance company or by filing a personal injury lawsuit and pleading your case in court. You could get money to cover your medical bills (past and present), medical-related expenses, and the time that you’re out of work if you win your case. This, of course, would take a load off your shoulders (and your pockets).

Dip Into Emergency Savings

An emergency savings account is an account where you set money aside for a rainy day or unforeseen circumstance. Getting into an accident is certainly an ideal time to use those funds. If you have several months’ worth of income saved in the account, you could find peace of mind in knowing that your bills are covered for a little while until you come up with other financial solutions.

File for Disability

If the injuries you’ve sustained are serious enough, you may be able to qualify for temporary or long-term disability coverage. This would provide you with a monthly income that can be used to cover the bills. It can take several weeks to get approved, so be sure to apply as soon as possible. You’ll likely need your medical reports or notes from your doctor to explain your injuries and ideal time in which you can return to work.

Look Into Assistance Programs

There are plenty of programs available for those going through hard times or living on a limited income. They are free to apply for and could provide you with peace of mind. There are programs to help with healthcare, car insurance, food, housing, childcare, and even transportation costs. Check with your local board of social services to find out how to apply for such programs.

Cut Costs

If you’re really struggling financially you’re going to have to get serious about your spending. Cutting back on your costs could help you save several hundred bucks each month. Cut your cable subscription, cancel monthly subscriptions for products and services you don’t need, or cook at home instead of eating out. You should also use methods like waiting 72 hours before making a purchase to ensure it’s something you really need.

Downsize

You may not like this next bit of advice, but if your injuries are long-term or permanent, downsizing may be the only way to survive financially. If you’re already broke or living on a shoestring budget, eventually, you’ll find yourself accumulating more and more debt and causing a plethora of financial trouble for yourself. If necessary, move to a smaller house or more affordable apartment, or consider living with family to give yourself a financial break.

You never thought you’d find yourself dealing with the aftermath of a serious accident, but here you are. Though overcoming this situation requires more than finances, when you’ve got bills piling up and can’t afford the bare necessities, the stress really adds up. As increased stress only intensifies pain and prolongs physical and psychological healing, it is ideal to have solutions to help you cover the costs of the car accident. With such a big stressor lifted, you can focus your energy on your physical and emotional well being.

Eminent Domain as a Mortgage Fixer?

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The housing crash of 2008 is still sitting heavy on many homeowners.  Many who bought a house during the peak of the market were left with houses that they’d bought at nearly twice the current value of the home.  Much has been said about the dilemma that those homeowners find themselves in.  As the economy receded, so too did their jobs, and their pay, causing many to simply walk away from their homes when they could no longer afford the mortgage.

Foreclosure is a bit of a messy deal.  The bank takes the home back, and then sells it, attempting to recoup some of the value of the mortgage.  We’ve seen many different methods of attempting to avoid the bulk foreclosure of homes in America.  From Government sponsored programs that help with restructuring of the loan, to banks voluntarily restructuring the loan, to what is a rather disturbing new program in Richmond, CA.

The program is laid out in this recent article on CNN Money. (California city’s drastic foreclosure remedy: seizure)  In the article, the City has started a program to attempt to purchase the mortgages of many underwater loans in the city.  It’s an attempt to avoid the decline of low-income neighborhoods, and those neighborhoods already hit hard by the economy.  Seems pretty normal, until you read a bit further.

But if the holders of the loans, who are mostly investors, refuse to sell by Aug. 14, the city said it will invoke eminent domain to seize the mortgages so it has more control over the process of making them affordable.

Eminent Domain Mortgage FixerThat’s right.  If the investors refuse to sell by August 14th, the city will invoke eminent domain and seize the mortgages in order to bring those mortgages into the program.

There are several things at play here.  I don’t argue that there are many who are nearing foreclosure, and that in many cases, they were preyed upon by the banks and investors by being given loans for houses they couldn’t afford in the first place.  I don’t think that excuses the buyers from not knowing that they couldn’t afford the mortgage.  I’m sure there are those that could afford the house at the time of purchase, but have since fallen on hard times.  In some cases, I do think that there should be something in place to help people ease the pain of their mortgage.  But, that’s another article.

Back to Richmond, CA, and their silly new program.  They plan on using eminent domain to seize the mortgage.  As is pointed out in the CNN Money article, eminent domain is usually used by public entities to seize physical properties to make way for public parks, malls, and right-of-ways for transportation initiatives.

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The article alludes to the fact that eminent domain, to be legal, must be used for that are in the public interest.  Meaning that the people of the city (or neighborhood) must have something to gain from the seizure. I think this is a bit of a grey area, and is likely to end up in court.  It’s legality, in the seizure of only certain mortgages, and not the mortgages of the entire neighborhood, makes its usage for the public interest somewhat shaky.  After all, who among us wouldn’t want to participate in a program that cut our mortgage in half and reduced the payments by the same?  Absolutely!  But, who among us has anything to gain by having our neighbor across the street participate in the program, and not us?  Yeah.  Even if I can afford my mortgage, I’d be a bit jealous.  If I really wanted to cause a scene, I’d sue the city.

Legality aside, I still think the program is a mistake.  Many places around the country are facing the same dilemma, and many are trying to find innovative solutions to fix the problem.  The city of Detroit just declared bankruptcy because the population of the city, and thus it’s tax-base, has dropped so drastically over recent years.  Perhaps the city of Richmond fears the same problem.  What they should be spending their time fixing, however, is their local economy.  They’ll spend all kinds of money executing this program, then defending it in court, only to still have the same economy.

If they can find ways to improve the economy by pushing local businesses, promoting local producers, and making improvements to the structures to do so, I think they’ll find that many of those foreclosures start getting picked up by new homeowners.

Maybe I’m wrong.  I’m certainly not an expert in economics, least of all economics in California.  What do you think?  Is the usage of eminent domain here a valid one?  Will it be challenged legally?  How would you feel if your city had a program like this?

Original image credit: End Eminent Domain Abuse by Paparutzi, on Flickr

Money in Space!

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I had originally planned on taking today off from posting for Columbus Day.  But, then, I thought, what the heck.  It’s a day that we celebrate explorers.  Columbus in particular, but exploration in general, as well.

1909 VBD Lincoln PennyThere aren’t many explorers on a global scale anymore.  After all, it’s not like you can jump in a boat and go find new continents, right?  Even back in Columbus’ day, money went along.  Whether it was as a good luck piece, or just in case they came up on a 7-11 in the new world, they had money with.  Today’s explorers have to go a little bit farther afield in order to discover something new, but even so, there’s still a little money that goes along.  And I’m not just talking about the Billions that are spent to do the exploring. There’s actual money in space!

Take for example, the newest exploration endeavor, the Mars Curiosity Rover.  Back in August, the folks at the NASA JPL labs in California managed to drop the Curiosity, a small car sized rover, onto the surface of Mars.  If you stayed up late enough (or got up early enough, I suppose) that night, you were treated to live video of the command center at JPL.  It was pretty awe-inspiring. Since then, they’ve been running all kinds of tests, and sending back some pretty incredible images of the surface of Mars.

Part of the rover is it’s ability to send such awesome pictures.  And part of that ability is the ability to calibrate it’s cameras.  The calibration panel that it uses has some interesting bits for calibration of color and detail, but also something added for basic scale.  That item?  A 1909 Lincoln VBD Penny.  Much like the one in the image, here.  Why a penny?

The MAHLI calibration target includes a penny at the center of this image, plus color chips, a metric standardized bar graphic, and (just below the penny) a stair-step pattern for depth calibration.

The coin is from 1909. That was the first year Lincoln pennies were minted and the centennial of Abraham Lincoln’s birth. The penny is a nod to field geologists’ informal practice of placing a coin as a size reference in close-up photographs of rocks, and it gives the public a familiar object for perceiving size on Mars easily.

Pretty cool, huh?  Money is everywhere!  Even in space!

img credit: 1909℗ Lincoln Penny. 019 by Elmo H. Love, on Flickr