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Southaven MS Bankruptcy Law Blog

Seniors face increasing need for debt relief

It's often thought that bankruptcy is an appropriate option for Mississippi families struggling with overwhelming debts. While this is indeed frequently the case, there are many more types of people who can benefit from the debt relief provided via personal bankruptcy. One such group is senior citizens. According to recently-released information from the Consumer Financial Protection Bureau, older Americans are increasingly troubled by both debt and debt collectors.

Per the CFPB, seniors make more complaints regarding debt collectors than they do about any other service or product. Between last year and this year, many of the submitted complaints focused on debt collectors who attempted to collect from the wrong person, collectors who used harassment or intimidation, to the complete lack of important information about the debt itself.

Key qualifications for Chapter 13 bankruptcy

Filing for bankruptcy is one of the most important decisions that some individuals may ever make. When an individual or business is in dire need of debt relief, bankruptcy can almost immediately alleviate the burden. For individuals who decide bankruptcy is right for them, deciding whether to file for Chapter 7 or Chapter 13 can be crucial.

There are many key differences between these two types of personal bankruptcy, but the most well-known is likely how each one handles existing debts. Under Chapter 7, many of an individual's qualifying debts are eliminated. Under Chapter 13, an individual agrees to a repayment plan; at the end of the repayment period, many of the qualifying debts are eliminated. Chapter 13 presents many advantages, such as the ability to rebuild a history of solid payments to creditors under the plan. Before filing for Chapter 13, though, a person must meet several important qualifications.

An attorney's advice often critical regarding credit card debt

Some Mississippi residents may believe that an attorney is only needed for certain financial challenges involving overwhelming debt, such as the threat of losing one's home, car or other forms of personal property. A bankruptcy attorney, however, can also help with seemingly "smaller" debt situations, such as credit card debt that has spiraled out of control.

Like all forms of debt, credit card debt can grow quite rapidly if even a few delinquent payments accumulate. Credit cards often have interest rates that are much higher than other forms of debts, such as federal student loans. As a result, even one missed payment can mean that the amount owed has grown sizably; moreover, the debtor must often pay fees associated with even a single late payment. When multiple late or missed payments add up, the final product can be debt that has gone from slightly unmanageable to completely insurmountable.

Link between Medicaid status quo and bankruptcy

In many states across the country, the Medicaid expansion has brought forth both praise and criticism. Mississippi decided not to participate in the Medicaid expansion, and not surprisingly, this move has also had both supporters and detractors. Some believe that the state's refusal to expand the healthcare program will negatively affect struggling residents who have unpaid bills related to medical expenses.

According to some recent studies, debt from medical bills is the biggest reason for personal bankruptcy in the U.S. In a struggling economy, issues like unemployment exacerbated the rising costs of healthcare. As a result, many in Mississippi and beyond have found themselves unable to pay the staggering bills for things such as surgery, the delivery of a baby, cancer treatment, broken bones and the like. The Commonwealth Fund reported that between 2005 and 2010, the number of Americans who indicated they had trouble paying medical bills rose by about 14 million.

What are the Mississippi Chapter 7 pros and cons?

The type of bankruptcy most individuals in Mississippi are likely to be familiar with, even if they have never declared bankruptcy themselves, is Chapter 7. Under Chapter 7 bankruptcy, many of a person's assets are liquidated to repay creditors. As a result, this type of bankruptcy is very attractive to those who struggle to cope with burdensome personal debt. On the other hand, some debtors may be hesitant to file since they worry about the credit-related drawbacks of this type of debt relief.

There are many different pros and cons of declaring any type of bankruptcy, and Chapter 7 for individuals is no exception. One of the main downsides related to credit is that Chapter 7 harms a person's credit score for years, as this type of bankruptcy can stay on a person's credit report for up to a decade. Nonetheless, the actual Chapter 7 process lasts only about three to six months. So, the tradeoff is a damaged credit score, but a relatively quick way to get out from under overwhelming debt.

The basics of vehicle repossession

One of the worst things that can happen to a driver is falling behind on car payments. In Mississippi, cars are essential for getting to work, transporting family members and simply carrying on with day-to-day living.

Being without a car is what often befalls those who become too far behind on their vehicle payments. When one finances or leases a car, their creditor holds crucial rights. These rights conclude when the car is paid-off, but until then, drivers must understand and acknowledge these rights. Unlike other assets, such as a home, vehicles can often be seized by creditors without a lengthy legal process or warning in advance. This is known as repossession and usually happens after the driver has missed a number of payments.

Filing for bankruptcy offers crucial legal protections

Any resident of Southaven is likely to have countless questions about individual bankruptcy, but one of the biggest is usually: is filing for bankruptcy right for me? There are pros and cons to any financial decision, personal bankruptcy included; like any major move, filing for bankruptcy is an action that can prove extremely beneficial, if done for the right reasons.

Anyone even pondering bankruptcy is likely to have a need for debt relief. Bankruptcy generally isn't for those who have a few credit card bills that they could tackle if they saved more and spent less. Rather, bankruptcy is an option for those who need genuine protection from creditors whom they cannot repay. Issues like unemployment can lead to bankruptcy, as bills pile up and eventually grow to an unmanageable size. While people struggle to pay their regular bills, these debts will continue to grow and bankruptcy can become a viable and appropriate solution.

Get a truly fresh financial start via Chapter 13

For some people who are grappling with overwhelming debt in Mississippi, 13 may be their lucky number. This is because the type of personal bankruptcy known as Chapter 13 allows Southaven area residents to achieve a fresh financial start. An individual can re-structure their financial situation in a manner that will produce long-term gains.

One of the first ways in which debtors get a fresh start by way of Chapter 13 is that the filing can stop creditor harassment. Without filing for Chapter 13 or Chapter 7, a person who owes unmanageable debt is likely to be hounded by creditors. While creditors must abide by specific rules and regulations, even when followed these rules don't eliminate the frequent phone calls and threats of garnishment.

Can an employer "punish" a worker for bankruptcy?

The relationship between financial challenges and a Mississippi resident's work situation is often very close. If a person loses their job, their urgency in finding debt relief is bound to increase tremendously. If someone is being hounded by creditors, that person may be concerned that creditors will start tracking them down on the job. If a person files for bankruptcy, they may wonder what effect, if any, their decision will have on their employment situation.

Fortunately, filing personal bankruptcy should not have an adverse effect on a person's job. The law expressly forbids employers - both private and government - from discriminating against workers solely because they are debtors. For instance, an employer can't fire someone simply because they have filed for Chapter 7 or Chapter 13 bankruptcy. In addition, an employer is not allowed to terminate a worker due to that worker not paying a debt that was discharged under their bankruptcy terms.

Keeping your home and car under Chapter 7

Large amounts of personal debt aren't unusual nowadays, but the variation is often in each Mississippi resident's ability to pay back that debt. For residents of Southaven and surrounding areas, the answer to insurmountable debt is often Chapter 7 bankruptcy. Under this type of personal bankruptcy a debtor is able to make a fresh financial start via asset liquidation. Many wonder, though, if they may be able to file for Chapter 7 while still holding onto their home or their car.

In Mississippi, it is possible to keep both your home and your vehicle while filing for Chapter 7. Under Chapter 7, some property is exempt - it gets to stay with the debtor instead of going towards the bankruptcy estate to be sold for paying back creditors. Exempt property is usually that which is necessary for day-to-day living; a person can't get back on their feet without some of the basics of life. In Mississippi, these basics include homes and cars.

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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