More Money Problems

As the economy continues to take its toll, reporting agency Reuters reports that consumer bankruptcy filings in 2010 were the highest in 5 years.

The filing of 1.53 Million consumer bankruptcy cases in 2010 demonstrates more about the economy that the talking heads on the evening news can tell us.  Regular working folks, and many who aren’t working, file bankruptcy to keep the creditors from calling, from suing and from garnishing their wages.

When you hear the reports from Washington saying the economy has turned the corner, just recognize that the 1.53 Million filings are a 9% increase over the 1.41 Million cases filed in 2009.

So what should you do if you have explored every option but are still unable to manage the debt you are facing?

There really are three options:

1.  Keeping paying your creditors, a little here and a little there.  You do this to try to fade the heat of the constant harassment by your creditors.  This won’t get you out of debt like a Chapter 7 bankruptcy filed in Knoxville will do.  But it does help you on a creditor by creditor basis.

2.  Try some sort of credit consolidation, like “credit counseling.”  In nearly 30 years of filing bankruptcies for folks living in Knoxville, Maryville, Sevierville and Jefferson City, I’ve seldom see this method achieve anything other than dissipating more money.  Often during the early part of that process you are simply paying the services fees because the process is “front end loaded.”  I help many folks who wake up 14 to 16 months in and realize that they’ve made very little dent in the debt and can not really afford the payments.

3.  Seek the advice of an experienced bankruptcy attorney to find out if a Chapter 7 bankruptcy or a Chapter 13 bankruptcy is the better option for your family.  This is not the time to look for the cheapest attorney.  Consult with an attorney who has been filing bankruptcies for a number of years.  Most likely you want to avoid bankruptcy.  Be sure that you get good advice in helping you make the decision whether bankruptcy is best for your family.  I offer a free consultation to help take away the fear of seeing an attorney.

Photo Credit:  espnensorvik