23
Chapter 1: Assessing Where You Are Financially
Book I
Taking
Charge
of Your
Finances
Asset
Value
Office Equipment Not Included in Household Goods
Other Assets
Adding Up What You Owe
Purveyors of consumer credit want you to think in terms of monthly pay-
ments instead of considering the total amount you owe. It's a lot easier to sell
that new car when the customer focuses on a $400 monthly payment rather
than on a $25,000 albatross. But when it comes to assessing your financial
condition, knowing the total amount of your debts is critical.
Consider home and car loans separately from other debts, for two reasons:
You can reduce or eliminate these loans if you sell the house or car.
Bankruptcy affects home and car loans differently than other debts.
You can find out how much you owe on these loans by phoning the creditor.
If you're behind in payments, also find out how much it will take to bring the
loan current (that is, not behind anymore, as opposed to paid in full).
Filling the blanks in Table 1-3 helps you get a grip on what you owe.
Table 1-3
What You Owe on Mortgage and Car Loans
Total
Balance
Owed
Monthly
Payment
Value of
Home/Car
Arrearage
(Amount
You're
Behind)
Residence
Other real
estate
Cars
Calculating how much you owe on other debts is a little tougher. Ordering credit
reports is one place to start (see earlier in this chapter and Book I, Chapter 5).
You can often determine the amounts owed on judgments, child support,
alimony, fines, and restitution obligations from documents on file in the
