Bankruptcy is sometimes the only way out. Here are some things to think about. Nobody plans to file for bankruptcy but sometimes circumstances arise that make it the only way out.
With the current state of economic affairs in the United States and around the globe,
many individuals are pondering the decision about filing. There are many reasons why a person ends up in this unfortunate financial boat.
Many responsible individuals have become plagued by money troubles that keep them up at night, ruin their health and tear apart their family life. While no one wants to throw in the towel, it may be beneficial to all concerned to wipe the slate clean and start over again. Why are so many people considering filing Chapter 7 or Chapter 13? Here are some things to think about:
- Housing crisis: Over the last several years, many homeowners have seen their home values plunge drastically. In some regions of the country, such as Arizona and Nevada, houses are now worth half of what they were valued at several years ago.
Many lenders were giving out loans to anyone with a pulse and this was an unfortunate choice for everyone. Now if an owner wants to sell their property, they are likely to lose money or even pay the bank to get out. Individuals who need to move out may have no choice but to let their home-sweet-home go into foreclosure.
- Health care woes: If a catastrophic illness or accident strikes, individuals without health insurance may be crushed financially. Hospital and doctor bills can escalate into tens of thousands of dollars for even one surgical procedure or hospital stay. Missing work can mean loss of income temporarily or loss of their job altogether. Even people who are covered by health insurance may find their portion due to amount to huge piles of cash.
- Divorce: Couples that decide to end their marriage with divorce may find themselves soon teetering on the financial brink or filing for bankruptcy.It’s tough enough to pay the bills with two incomes, but trying to cover everything with one income can add up to deep pools of red ink.
- Job loss: Layoffs have occurred in many industries and businesses across the country. Unemployment benefits only last so long and when they run out, families may be left without a safety net. Bills piling up can add to the stress of no job.
- Credit card debt: Many consumers have been sucked into the permanent debt culture of credit cards. It’s so easy to swipe a rectangle of plastic at the grocery store, gas station, department store and more. Even frugal shoppers will be shocked at how fast these bills add up. Once a person is in the habit of paying with plastic, it’s easy to get sucked into the quicksand.
Many individuals are under huge strain due to finances. The economy has soured and taken many individuals’ peace, marriage, job, home and savings account with it. No one plans to file for bankruptcy but sometimes it necessary. Wiping away or reorganizing the debt with Chapter 7 or 13 filings may be the best way for an individual and their family to start over again.
