During the financial crisis, there were 1.6 million bankruptcy filings per year. While that number has dropped by roughly 50% in recent years, it doesn't necessarily mean that Tennessee residents are doing better financially. In some cases, individuals don't file for bankruptcy because they can't afford the $1,000 or more that it can cost to do so. However, the benefits of filing may outweigh the cost to do so.
Many people in Tennessee struggle to make ends meet, even if they have significant assets or properties that they want to keep or make a substantial salary. Credit card debt, medical bills and other expenses can put people's financial health and credit rating at severe risk, especially when they wind up dealing with creditor calls and debt collectors. People often think that they can only declare bankruptcy if they give up all of their assets. However, Chapter 13 bankruptcy offers an option that allows people to retain their property while paying off their debts through a special, court-approved repayment plan.
In Tennessee and across the United States, people who are experiencing severe financial challenges may need to contact an attorney regarding debt relief. Delinquency in mortgage payments and credit cards may lead to a constant bombardment from creditors attempting to collect payments. A debtor may have the ability to stop creditor harassment by taking the right legal steps. A person who receives a court summons or official complaint from a creditor needs to respond promptly.
Young people in Tennessee need to be careful with credit cards. When they take on credit card debt, it can be difficult for them to get out of debt because of the high rates of interest that card issuers charge.
When a Tennessee resident is diagnosed with cancer, it's important to concentrate on overcoming the disease. However, a patient may also find that financial worries continue to haunt them throughout the treatment process. Indeed, there are good reasons for these concerns; even people with health insurance often struggle to pay their medical bills during cancer treatment. Prescription drugs can cost in the thousands of dollars and treatment can amount to $150,000 or more.
Some people in Tennessee who are struggling with student loan debt may find it easier to discharge those debts in bankruptcy if a federal bill that has been introduced is successful. Discharging student loans has gradually become more difficult since the 1970s, and currently, in order to be eligible for discharge, student loan payments have to be causing "undue hardship".
If a Tennessee resident fails to pay a credit card balance, the card issuer may write it off. According to a representative from Capital One, a degradation in customer credit quality has led to an increasing number of charge-offs. It has also lead to an increasing number of credit accounts becoming 30 days past due. The charge-off rate in the United States was 3.82% for the first quarter of 2019. However, the charge-off rate at Capital One was 5.04%.
Some Tennessee residents may be able to file for bankruptcy to get a better handle on their finances. Both individuals and businesses can file for protection from creditors, and there are many different types of bankruptcy to choose from. Chapter 7 bankruptcy is known as a liquidation bankruptcy. It involves selling some or all of a debtor's nonexempt property in an effort to raise money to pay off creditors.
Debtors in Tennessee and throughout the country may be contacted by a debt collection agency. While there are many tactics that they can use to collect payment, there are also things they cannot do in an effort to obtain a debt. It is important for an individual to understand his or her rights under the Fair Debt Collection Practices Act, or FDCPA. It prohibits debt collectors from using abusive language or from contacting debtors at work.
Chapter 13 bankruptcy is sometimes referred to as reorganization bankruptcy. It allows a person to pay off debts over a predetermined period of time, typically three to five years. It is ideal for a wage earner with good income who is having trouble making payments on time. One of the advantages of a Chapter 13 bankruptcy is that it allows a debtor to keep certain assets, such as their home and car.