What are the top 10 reasons someone in Central Ohio would file for bankruptcy in 2018?
According to USA Today, consumer debt has reached all-time highs in 2018, leaving many people feeling the heat and finding the need to file bankruptcy to overcome their financial burdens. Bankruptcy is often the solution for individuals who’ve accumulated mounds of debt they’re unable to repay. Bankruptcy dissolves the monies due or offers a repayment solution suitable for the budget, depending upon which type of bankruptcy is filed. It may seem like a drastic solution to a debt problem, leaving many to wonder what type of issues cause a Central Ohio resident to turn to bankruptcy as their preferred financial resolution. Below are the ten (10) biggest reasons people throughout the state file bankruptcy when they’re in debt over their heads.
One out of every ten home purchases end in foreclosure in Ohio. Losing your home is devastating, but bankruptcy can help. Most people turn toward this solution when faced with a potential foreclosure of their home. Specifically, filing a Chapter 13 bankruptcy case can also help someone retain their home by allowing the back payments to be paid over the course of three to five years, to get current on their mortgages.
2- Credit Cards
An average credit card debt of $5,792 is held by the average Ohio resident. As one of the biggest causes of consumer debt, it’s best to avoid usage of a credit card except in emergency situations.
3- Medical Bills
Medical care is not optional when your life or livelihood is on the line. Fortunately, medical care is provided regardless of an individual’s ability to pay for the services in many cases, leaving behind thousands of dollars in debt as result. Bankruptcy can help alleviate some of the burdens of medical bill debt.
A divorce is a life-altering event that oftentimes leads to financial turmoil and debt. Once the debt accumulates, bankruptcy follows as a person learns firsthand that it may be difficult to live on one single income.
Many people make the irresponsible choice of purchasing a new vehicle they cannot afford. It is very attractive to the eye and hard to turn down, but even more painful when the car that was yours at one time is no longer. Bankruptcy may save your vehicle if you can afford it, or it can lead to filing to save yourself from further hardship.
Losing a job can be devastating to anyone’s life. Without income coming in, paying bills isn’t easy and can lead to mounting credit card debt, used to purchase gas and groceries. Bankruptcy is often the solution when there is a long period of unemployment.
7- Personal Loans
A loan can provide a solution to a financial need, but it can lead to further problems if the money isn’t repaid. Failure to repay a loan can cause wage garnishment if bankruptcy is not filed. These loans can come in the form of a personal unsecured loan, a personal secured loan, or a cash advance loans. These loans often come with extraordinarily high interest rates causing the monthly payments to skyrocket.
With creditors calling your home and work at all hours of the day and night, letters and threats coming in the mail and inside your email box, and the worry of how you’ll overcome the debt is stressful. Many people who file bankruptcy do so to relinquish this health concern. Court actions and threats of garnishment can also cause stress to grow out of control.
9- Satisfy Debts
Many people find that, if they were not properly insurance and get into a vehicle accident, the other driver’s insurance company can allow the BMV to suspend one’s license. Filing bankruptcy can often mean that those license reinstatement fees, as well as any amount owed in property damage from the vehicle accident, are dischargeable.
10- Faster Recovery
When there are mounds of debt piling up, it is hard to sleep at night. It might be impossible to get a loan, a vehicle, or even rent a home with this tremendous debt standing in the way. Bankruptcy help allow for a fresh start and allows the ability to rebuild credit over time.
© Zellar & Zellar, Attorneys at Law, Inc., 2018; All Rights Reserved.