Bankruptcy and Foreclosure
This whole situation is a classic case of people living way beyond their means financially. Joe and Teresa Giudice filed for chapter 7 bankruptcy in October 2009, due to $10.85 million in debts. According to People magazine, Joe and Teresa Giudice filed bankruptcy due to failed real estate ventures and weak economic conditions. The Giudices are required to go through credit counseling, and were awarded a temporary stay on payments for their Cadillac Escalade and mortgage payments for properties.
Teresa Giudice has denied rumors via twitter that her primary residence (the dream home built during season 1) is up for sale. Teresa went ballistic when Danielle Staub said the F-word to her. On WatchWhat Happens Live, Teresa denies that her residence is in foreclosure. Teresa Giudice claims that one of her investment properties is in foreclosure.
Well, there are contradicting reports: The New York Post reported that her $1.8 million home, is in foreclosure. This is the same residence that Teresa Giudice has repeatedly defended against foreclosure rumors. The reports further state that other properties owned by the Giudices are being foreclosed on as well. Joe Giudice joked during an episode of The Real Housewives of New Jersey that their family might have to live in a small apartment above a pizza parlor. That joke could become a reality one day.
Details about the bankruptcy auction
The contents of their 10,000 square-foot mansion in Towaco, New Jersey is scheduled to be auctioned off on August 22, 2010. The auction will be hosted by Teresa Giudice at her home in New Jersey and A.J. Willner Auctions, is handling the auction. Some of the items up for bid include the following:
Schaefer & Sons grand piano
two LCD TVs
a decorative urn
an antique style pool table
a suit of armor
four chandeliers and three sconces
Sea-Doo Bombardier X20 jet boat
a steel snowplow
Wolf 48″ stainless steel oven range
framed paintings and numerous pieces of furniture
An oversized wall mirror and kidney shaped vanity table
Mahogany poker table and chairs
Mahogany home bar and stools
The address of the property where the auction will take place is as follows:
6 Indian Lane
Towaco, NJ 07082
Prospective bidders can obtain more information and view a complete list and pictures of the items up for auction at www.ajwillnerauctions.com. Live bidding on the internet is available through registering at Proxibid.
A Fresh Start
This bankruptcy is a slap in the face to many Americans suffering in this economy. Bankruptcy is intended as a “Fresh Start” for insolvent individuals and companies that have incurred debts in good faith which can’t be repaid. The bankruptcy court is not to be used for the purpose allowing people to deliberately run up massive amounts of debt and later avoid repayment by filing bankruptcy.
My intuition tells me that this is what Joe and Teresa Giudice did. Teresa Giudice was filmed during a season 1 episode of The Real Housewives of New Jersey spending over $120,000 on furnishings and decorations for the Giudice “dream home”. Teresa was filmed splurging at clothing retailers for her children. In another episode of The Real Housewives of New Jersey, Joe and Teresa had an over the top housewarming party. Don’t get me started on the yellow diamond that Joe Giudice bought for Teresa as an anniversary present. (I can’t believe Teresa Giudice was foolish enough to say on national television that she didn’t know that diamonds are in Africa, but that’s another article).
It is really unfair to millions of people who have lost their jobs, homes and possessions. I would never castigate or put down someone who filed bankruptcy, because of financial losses and debt beyond their control. For example, there are families with sick children who are forced to file bankruptcy due to astronomical medical bills. When you go on wild shopping sprees and spend in excess, how can you claim that you don’t have any money to repay your debts?
I don’t see the logic in spending thousands (or millions) of dollars on material things that aren’t a necessity, rather than repaying your debts and/or saving your money. Also, the bankruptcy trustee in their case, John Sywilok, is accusing Joe and Teresa Giudice of not reporting all income, concealing key financial documents and undervaluing personal property.
Nothing’s private anymore
In a statement to People magazine, Teresa Giudice said, “While this is a personal matter, I realize that certain aspects of my private life will always be subject to scrutiny and distortion.” Well, if she thinks that it’s none of the public’s business, she’s partly mistaken for two reasons:
1. The Giudices have opened their homes and aspects of their daily lives up to millions by choosing to partake in The Real Housewives of New Jersey.
2. When your property is forced into foreclosure, the lawsuit becomes public information. The same is true for bankruptcy filings. This is done to put creditors and the public at large on notice and to protect all parties involved. So in actuality, all interested parties and the public have a right to now what’s going on.
Heeding words of wisdom
Joe and Teresa Giudice should take a page out of Robert T. Kiyosaki’s book, Rich Dad, Poor Dad. This book really changed my views on what constitutes an asset and what constitutes a liability. I used to view material possessions as assets. Here is a quote taken directly from the book: “Rich people acquire assets. The poor and middle class acquire liabilities, but think they are assets.” ( Kiyosaki, Lechter, p 58) Kiyosaki defines an asset as “something that puts money in [your] pocket” (61). A liability is defined as “something that takes money out of [your] pocket” (61). This book is not a cure all, but I wish I had this information 20 years ago.
Unless these material possessions are highly collectable or rare antiques, clothing, jewelry, furnishings, and automobiles tend to be liabilities, because they don’t usually appreciate in value. According to Robert T. Kiyosaki’s philosophy on assets and liabilities, an asset is something that will generate income for you. There is the strong possibility that the property auctioned will not fetch what Joe and Teresa Giudice paid for it.
Everyone, including myself, has made financial mistakes and bad investments. As stated before there are people who despite their best efforts, can’t help financial hardships and debts. It’s not my intention to put down people who file bankruptcy in good faith. However, Teresa and Joe Giudice’s wild spending sprees aren’t doing anything to improve the way they are viewed by the public. Their bankruptcy and financial situation reeks of fraud and deception. Furthermore, much of their financial wounds are self-inflicted and were preventable. There is nothing wrong with acquiring wealth and having nice things. There’s no shame in living within your means and having a budget, either. I don’t wish bankruptcy or financial hardship on anyone, but in the same breath, I feel no pity for Joe and Teresa Giudice.
Related articles/ sources:
Rich Dad, Poor Dad, Robert T. Kiyosaki and Sharon L. Lechter (authors), Published by Warner Books in association with CASHFLOW Technologies, Inc., Copyright 1998
NJ Housewife Teresa Giudice: Bankruptcy is a “Fresh Start”
from tvwatchpeople.com, author, Charlotte Triggs
Will Teresa Giudice Have to Auction Her Pool Table to Pay Bills?
from tvwatchpeople.com, author, Charlotte Triggs
Spendaholic “Housewife of NJ” owes a big-hair-raising $11 M
from www.nypost.com, author, Jeane Macintosh
AJ Willner Auctions, LLC