A growing number of people in Virginia are facing escalating credit card balances. According to the New York Federal Reserve, younger Americans traditionally steered clear of credit card debt. Many millennials came of age during the financial crisis in 2008 and became more thrifty as a result. However, credit card delinquencies for 90 days or more have risen the most among younger Americans. For people age 18 to 29, these types of delinquencies reached 8% of all credit card balances in the first quarter of 2019.
The Supreme Court ruled on June 3 that creditors in Virginia and around the country may be held in civil contempt if they pursue payment of a debt that has been discharged in a bankruptcy. The nation's highest court applied an objective reasonableness standard to decide a case involving an Oregon business center's efforts to collect a debt from a real estate developer who had filed for bankruptcy. This standard means that creditors can be held in contempt when they seek payment of a debt that they have no reasonable basis to believe is not included in a discharge order.
Roughly 530,000 families throughout Virginia and the rest of the U.S. file for bankruptcy each year. The majority of those cases involve debt incurred due to medical reasons, according to a study published recently in the American Journal of Public Health. After reviewing bankruptcy data, a team of academics discovered that 66.5% of Chapter 7 and Chapter 13 petitions are filed by individuals who either have medical bills that they cannot pay or suffered a financial setback after an illness or injury left them unable to work.
Those in Virginia and throughout the country who are struggling to manage their finances may find it helpful to file for Chapter 7 bankruptcy. Although it will impact a person's credit score, it may also make it easier to create the foundation for a stronger financial future. One of the advantages of filing for a liquidation bankruptcy is that it only takes about three to six months to have debts discharged.
Even when Virginia patients make an effort to use medical services in their insurance networks, they might fail to avoid out-of-network charges during hospitalization. Many patients understand that costs could be higher from out-of-network providers, but they may not realize that unexpected medical bills can result when they use in-network hospitals. Hospital administrators often cannot answer questions about out-of-network professionals and laboratories providing services within their hospitals due to complicated insurance contracts.
Some Virginia residents who are struggling with debt may be considering filing for Chapter 7 bankruptcy. One of the major concerns for many bankruptcy filers is ruining credit scores. However, it is possible to rebuild credit after a bankruptcy.
Virginia consumers who are struggling with debt might wonder whether they should file for Chapter 7 bankruptcy. In order to file for Chapter 7, they must pass what is known as a "means test". This means that their income must be below a certain amount, which is usually the median income for the state. However, there are additional considerations in determining this income. For example, certain expenses may be taken into account and deducted from overall income to determine eligibility.
Chapter 7 bankruptcy may help Virginia residents and others seek relief from debt. The process begins by filing paperwork that outlines the debts and assets a person has. Debtors may also be required to produce pay stubs and other financial information to the bankruptcy court. Documents needed to petition for protection from creditors can typically be obtained for free. Prior to doing so, an individual will need to take part in a credit counseling session.
Spiraling health care costs and the overwhelming debt to which it can condemn families been a problem in the United States for many years, and Congress took action to address the issue by passing the Affordable Care Act in 2010. However, a recent study published in the American Journal of Public Health suggests that the landmark legislation has not had the desired effect. In the first major study of its kind since the ACA became the law of the land, researchers discovered that medical debt still plays a role in about two-thirds of the personal bankruptcies filed in Virginia and around the country.
Virginia residents may wonder if student loans can be eliminated through bankruptcy. The quick answer is no. However, there are some exceptions to the rule.