This post is general information not legal advice.
Generally, when a company still has “going concern” value, they may use the chapter 11 process to sell non-performing assets, terminate burdensome contracts (e.g., we work), and restructure its balance sheet (such as reducing debt with equity) so that the company may be more financially sustainable.
That’s why they call chapter 11 bankruptcy “restructuring.”
If the company is no longer a going concern, I.e., given time it would likely run to the ground, then the best outcome for creditors will be to liquidate all company assets (chapter 7) and orderly distribute the proceeds… secured debt first, priority unsecured, general unsecured…
IF EC EVENTUALLY FILES FOR CHAPTER 7 LIQUIDATION—
Deposits will be in a weird place unfortunately. Even though deposits were paid to commission the build of a specific vehicle, unless a security agreement was explicitly arranged, the buyer does not have “security” in that vehicle. What this means is that funds from the sale of those vehicles will be pooled with other funds to pay creditors in legal priorities. Only a small portion of a client’s deposits (a little over $3300 based on latest inflation adjustments) will be priority unsecured claims. The remaining portion will just be general unsecured claims.
Can’t really fathom what prompted EC’s decision as an outsider, but do know that debt can be very dangerous… especially variable rate debt.
On the latest Overlander News, there's an ad from Storyteller Overland about their lineup of vans for 2024. The ad is a perfect example of why many of the overlanding business models are unsustainable. (https://storytelleroverland.com/pages/2024-beast) At 1442/month (with 20% down) for 20 years at 7%, that van would cost a total of $346,000 -- for a van that will depreciate at least 40% in the first 5 years! By year 10, it's probably lost 60-70% of it's value or more. I'm a former financial planner and these types of purchases are exactly why a vast majority of Americans are unprepared for retirement.
On the latest Overlander News, there's an ad from Storyteller Overland about their lineup of vans for 2024. The ad is a perfect example of why many of the overlanding business models are unsustainable. (https://storytelleroverland.com/pages/2024-beast) At 1442/month (with 20% down) for 20 years at 7%, that van would cost a total of $346,000 -- for a van that will depreciate at least 40% in the first 5 years! By year 10, it's probably lost 60-70% of it's value or more. I'm a former financial planner and these types of purchases are exactly why a vast majority of Americans are unprepared for retirement.
On the latest Overlander News, there's an ad from Storyteller Overland about their lineup of vans for 2024. The ad is a perfect example of why many of the overlanding business models are unsustainable. (https://storytelleroverland.com/pages/2024-beast) At 1442/month (with 20% down) for 20 years at 7%, that van would cost a total of $346,000 -- for a van that will depreciate at least 40% in the first 5 years! By year 10, it's probably lost 60-70% of it's value or more. I'm a former financial planner and these types of purchases are exactly why a vast majority of Americans are unprepared for retirement.
I'll take that money! My cost of money is less than 4% and you're paying 5,6,7 points over that, yep, I'll take that money all day long.a 20 year loan on a van! good lord. What banker would think that is a good idea.
a 20 year loan on a van! good lord. What banker would think that is a good idea.
My bet its not a bank or credit union but an outfit like Trident Funding which is a big RV, boat and plane lender.Bankers who put profits over common sense, or the opportunity to school a perspective buyer instead of enabling their foolish behavior simply because they have the credit.
Back to the office mandates, already had my fun for a couple years, trying to get out before more depreciation hits, finding out that full time isn't as fun as Insta makes it look... Upgrading? so many reasons.I see that EC has removed the for sale units from their website.
Not sure it's a sign of a weak market or just the fact that there have been so many Earth Roamers made and sold over the years, but there are 16 pre roamed on the ER website. I think that's the most I have seen.
even with great credit, the bank is going to want its collateral worth something. A 15 year old RV on a 20 year note isn't worth much. At 8% on a $200K rig in 15 years you still owe $82K.I'll take that money! My cost of money is less than 4% and you're paying 5,6,7 points over that, yep, I'll take that money all day long.