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Southaven MS Bankruptcy Law Blog

Student loan data points to intense need for debt relief

Many Southaven residents have likely heard of the negative impact student loans have had on Americans' existing financial challenges. Countless college graduates, and even those who haven't finished their degrees, struggle with the need for debt relief. While student loans have financed public and private college educations for years, today they represent an increasingly sizable share of government-issued debt.

Information out of the Federal Reserve Bank shows that over 11 percent of student loans were classified as delinquent during the fourth quarter of 2014. According to the Education Department, 13.7 percent of borrowers who would have started repayment in 2011 have defaulted on their loans. Additional data points to a troubling mix of factors that could cause even more Americans to become buried in debt. For instance, it is estimated that another $1 trillion in student loan debt will accumulate in the next ten years. This is partly due to the soaring costs of attending college; tuition has increased by over 1,000 percent since the late 1970s.

Efficient bankruptcy filing key to stopping garnishment

Many northern Mississippi residents depend on their weekly or monthly paycheck to pay bills and meet various legal obligations. Still, in a struggling economy, expenses can quickly get out of hand, debts may spiral out of control -- and at some point, that paycheck may be put in jeopardy. The threat of garnishment is very real to many local residents, but the threat can be eradicated with legal help.

Stopping garnishment is possible; however, many debtors may not know where to begin or how to ask for help. The legal experience of Heidi S. Milam, Attorney at Law P.L.L.C. can help local individuals and families struggling with the possibility of asset forfeiture. Wage garnishment can be halted via filing for bankruptcy - in fact, as soon as one files, wage garnishing actions must come to a stop. Filing for bankruptcy also puts an immediate end to repossession action as well, making bankruptcy an option for those who cannot afford to live without their full paycheck, vehicle and other vital personal property.

Credit cards feature various types of annual percentage rates

Credit card interest rates are commonly encountered by residents of Southaven, but not everyone understands the different types of rates and their financial implications. As some local residents may know, credit card debt has a way of quickly getting out of hand; at that point, it may be necessary to take decisive steps, such as filing for bankruptcy, in order to take care of the debt. Still, it’s helpful to understand credit card interest in order to avoid or resolve issues with credit card debt.

In its most basic form, credit card interest rates are the price a person pays for a credit card’s borrowing capability. With most credit cards, the interest rate is a yearly rate known as an APR, or annual percentage rate. However, one credit card account can sometimes feature more than a single APR. In such cases it is often different types of transactions, such as purchases versus balance transfers, that have different APRs. Moreover, one APR may vary over time, such as a promotional rate that later changes to a higher rate after a set period of time.

What types of debts cannot be discharged via Chapter 7?

Commonly known as "straight bankruptcy" or liquidation bankruptcy, Chapter 7 bankruptcy is an option for many struggling with debt in Mississippi. Since many debts can be discharged under Chapter 7, many debtors will gravitate towards this option since repayment is not feasible. Still, it's important to know that not every type of debt can be discharged via Chapter 7 bankruptcy. As a result, those considering filing for this type of bankruptcy may wish to learn more.

Under Chapter 7, many common sources of overwhelming debt can be discharged; these include credit card debt and many types of medical debt. However, there are certain other forms of debt for which a debtor remains legally responsible. These include student loans, taxes and debts stemming from fraud or drunk driving. In addition, many types of debt related to family law are also non-dischargeable; these include child support obligations, alimony or spousal support and property settlements stemming from divorces.

Research shows bankruptcy reform may not benefit debtors

Filing for bankruptcy is rarely an easy decision for a Southaven resident to make. After consulting with an attorney, one's legal options can be clearer and a debtor may then be in a position to choose between Chapter 13 and Chapter 7 bankruptcy. Regardless of the type of personal bankruptcy, though, many debtors have questions regarding how easy it is to file and if they are eligible to move forward with the process.

Individuals who are considering filing for bankruptcy may have heard about 2005 reforms, which made it tougher for some individuals to file. Recently, reports have pointed to unexpected effects of the mid-2000s reforms. According to researchers from Columbia University and the New York Federal Reserve, the reforms appear to have led to a drop in the bankruptcy rate. However, according to other researchers, the changes may have also had some negative economic effects.

Speaking with one's creditors about repossession

Any Southaven resident who has ever financed a car is likely to know the sinking feeling that comes with missed payments. Late notices start arriving in the mail, phone calls and voice mail messages start accumulating, and sooner or later the threat of repossession becomes very real. In today's economy, it's not unusual for local residents to experience financial challenges that leave them wondering how they will cope with the prospect of repossession.

In many cases, drivers will ignore contacts made by their creditors, either out of fear or distrust. However, if no contact is made with one's creditors, and no payments are made during that time, it's very possible a driver's vehicle will be physically taken back by the creditor. In order to avoid such a scenario, it may be beneficial to speak with creditors and inform them of the situation. While this can be intimidating, communication can go a long way towards avoiding or resolving a vehicle repossession in Mississippi.

An experienced advocate ready to help with Chapter 13

The number 13 is often considered unlucky; for those struggling with debt in Southaven, though, 13 may prove to be a positive number. Residents seeking a solution to their financial challenges may find it in Chapter 13 bankruptcy, which helps individuals put a lid on mounting debt and effectively tackle existing debt.

How does Chapter 13 benefit local residents? Chapter 13 has the ability to both reduce and eliminate debt. In many cases, filing for Chapter 13 allows a debtor to get a handle on debts by agreeing to a repayment plan. The period of repayment lasts three to five years; in that period the debtor can start to establish a solid history of making timely, complete payments. At the conclusion of the repayment period, the remaining debts can often be discharged. Additional benefits of Chapter 13 including keeping one's home and keeping other items of personal property. Chapter 13 can also put an end to threats of garnishment, repossession and even foreclosure.

How does my marital status affect my bankruptcy filing?

Despite the term "individual bankruptcy," a person's bankruptcy filing can impact the whole family. For Mississippi families seeking relief from overwhelming debt, a personal bankruptcy can allow for a new financial beginning that can benefit spouses as well as children. Still, while bankruptcy offers many benefits to one's family, there are often plenty of questions that must be answered before filing. One question is how a filer's marital status or situation will affect their bankruptcy case.

First, it's important to know that a married individual can still file for bankruptcy on his or her own. At the same time, a married couple can also jointly file for bankruptcy. It may be helpful to speak with a local bankruptcy attorney regarding which option is best for one's personal and family circumstances. Filing alone may make sense if only one spouse has massive debt. Filing together may prove more appropriate if both spouses have significant debt that needs to either be discharged or reorganized under a repayment plan.

25 percent of Americans consider bankruptcy

As tax-filing season nears, many Mississippians are probably taking a closer look at their financial situation. What they may not realize is that a large percent of Americans consider filing for Chapter 7 bankruptcy to get debt relief because of their financial challenges.

A recent study focused in on the bankruptcy-filing population. According to its findings, roughly 25 percent of American households have considered filing for bankruptcy. 18 percent of those surveyed actually carried out with the plan and filed for Chapter 7 bankruptcy. The study reveals some reasons people may be more or less inclined to file for bankruptcy. Often, those families who make less than $40,000 per year file for bankruptcy. They understand that bankruptcy can offer a fresh financial start. Nevertheless, others are skeptical, believing bankruptcy to be somewhat "shameful."

Grounds for the denial of discharge of Chapter 7 debts

There are many reasons why a Mississippi resident may consider Chapter 7 bankruptcy. The individual may be struggling with debt that cannot feasibly be repaid in a timely manner; the debtor may also be seeking a way to stop creditor harassment and wage garnishment. Another reason why Chapter 7 bankruptcy is very compelling for individuals is the ability to get many debts discharged. For a person struggling with massive debt, this aspect of Chapter 7 is crucial.

It may be the case that not every single debt can be discharged under Chapter 7; for instance, child support obligations cannot be discharged through bankruptcy. Still, filers often find that most, if not all, of their outstanding debts can be discharged via Chapter 7. However, every once in a while, under certain circumstances, a denial of discharge occurs. While this situation isn't common, it's helpful for filers to know how this could happen.

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Subscribe to this blog's feed Visit Our Bankruptcy Law Website Heidi S. Milam

Attorney at Law, P.L.L.C.
7160 Tchulahoma Road, Suite A5
Southaven, MS 38671

Phone: 662-655-1605
Toll Free: 888-341-8136

Fax: 866-267-5360