Many individuals and families in Tennessee struggle with their personal finances. in addition to trying to afford necessities, they also may be dealing with large amounts of personal debt. Recent research into the debt loads carried by many Americans show that this struggle may continue for many years.
In fact, a report by the Federal Reserve Bank of New York indicates that both auto and student loan debt has been on the increase. There are several reasons for this; however, much of it is due to the fact that most student and auto loans lack the kind of underwriting that taking on other types of debt normally require.
For example, in some cases, subprime auto loans are issued without any real documentation of the borrower’s income. The same may hold true for both parents and students who take out loans to pay for education. As a result, those who take out these loans may find themselves making payments that are difficult to afford.
While many people struggle to make regular payments, their best efforts may eventually fail due to job loss, medical emergencies, or other unexpected expenses. In some cases, Chapter 13 bankruptcy may prove to be a good option. In Chapter 13, a debtor who has an income can begin a three- to five-year court supervised repayment plan. At the end of the plan, eligible debt that remains is discharged by the bankruptcy court.
People who struggle with debt may benefit from speaking with a bankruptcy attorney. The lawyer could review the client’s case and make recommendations regarding debt relief, including the type of bankruptcy that might be the debtor’s best option.