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Michael D. Hart, P.C.
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chapter 13 bankruptcy Archives

More older Americans are filing for bankruptcy

Wealth inequality is blamed for many of the social ills in Virginia and around the country, and a report from the Consumer Bankruptcy Project suggests that it may also be behind a recent surge in bankruptcy filings among older Americans. Bankruptcy petitions filed by individuals 75 years of age or older have more than tripled since 1991, and filings made by people between the ages of 65 and 74 more than doubled during the same period according to the report.

Consumer debt in the United States continues to climb

Consumer debt around the country reached an all-time high of $13.2 trillion in the first quarter of 2018, which prompted many financial experts to conclude that consumers in Virginia and throughout the U.S. have not taken the lessons learned during the financial crisis and ensuing recession to heart. These fears are bolstered by a personal savings rate, which measures savings as a percentage of disposable income that has fallen to its lowest level in more than a decade. Household debt levels in the United States fell significantly between 2008 and 2013, and Americans saved more than 10 percent of their earnings as recently as the 1970s and 1980s.

What debtors should know about Chapter 13 bankruptcy

Virginia residents and others who file for Chapter 13 bankruptcy may repay their debts over three or five years. The length of time during which they must make payments depends on their income relative to the median in the state where the case is filed. To file for Chapter 13 protection, an individual must show proof that he or she has filed tax returns in the past four years.

Legal restrictions on debt collectors meant to prevent harassment

When debts go unpaid in Virginia, the original creditors often pass these bills off to debt collectors. The Fair Debt Collection Practices Act applies to third-party collection agencies. The law imposes a lengthy list of prohibited activities, which could represent harassment if violated. Well-informed debtors could recognize these unacceptable actions and resist harassment by citing their legal rights.

Carrying a balance bad idea for credit score

According to a report published by creditcards.com, approximately 43 million people across the U.S. have carried a debt balance on their credit cards in order to improve their credit scores. That amounts to 22 percent of American credit card users, and they may not be influencing their scores in the way they think. Carrying a balance is not among the five primary criteria that make up a Virginia consumer's credit score.

Effective strategies for dealing with medical debts

If a person in West Virginia has health insurance, it may still be hard to pay medical bills that he or she incurs to treat a medical condition. According to the Kaiser Family Foundation, 43 percent of adults with insurance said that they struggled to pay their deductible in 2017. Overall, 43 million Americans have medical debt according to the Consumer Financial Protection Bureau.

Payoff of credit card debt

According to information from the United States Census Bureau, the credit agency TransUnion and the Federal Reserve, people in Maryland and the rest of the country repaid $40.3 billion of credit card debt during the first three months of 2018. The amount represents the second-highest payoff amount in a single quarter since the $44 billion that was paid off in the first quarter of 2009.

Debts that may be discharged in a Chapter 13 bankruptcy

Filing either a Chapter 7 or Chapter 13 personal bankruptcy allows Virginia residents with overwhelming debt to take control of their financial situations and offers them the possibility of a fresh start. Filing a Chapter 7 petition may be the fastest and most straightforward way to escape crushing debts, but individuals with incomes that qualify them for this kind of debt relief sometimes choose to pursue Chapter 13 bankruptcy instead. This is because a Chapter 13 petition allows them to pay down their debts while retaining possession of assets like cars or homes that are secured by loans or mortgages.


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