The combination of the down economy and rising tuition costs has left many recent college graduates with substantial amounts of student debts. And, according to a news article by the Southern California Public Radio, the amount of student loan debt that Americans have acquired now exceeds debts for credit cards and car loans, combined.
The Federal Reserve Bank in New York estimated that by the fourth quarter of 2011, $867 billion in student loan debt was outstanding, and a recent report by the Consumer Financial Protection Bureau estimated that the total amount owed on student loans was over one-trillion dollars.
In an economy where students are unable to find high-paying jobs, making monthly student-loan payments becomes very difficult if not impossible. While filing for Chapter 7 or Chapter 13 bankruptcy may be able to help these graduates alleviate many types of debt – such as credit card debt or medical bills – so that cash can be freed up to make student loan payments, it is very unlikely that their student loans will be discharged.
In certain circumstances, though, student loans may be discharged through bankruptcy. If it is proved that the student loans are an “undue hardship” on debtor, his or her dependants, or his or her family, then a judge may order the student loans to be discharged.
Proving undue hardship is very difficult, though. In general, it must be shown that the debtor:
- Is unable to maintain a minimum standard of living;
- Is unlikely to change or improve his or her current situation any time soon; and
- Has made “good-faith efforts” to repay his or her student loans.
Even though student loans may not be discharged through bankruptcy, filing for bankruptcy still may help you get back on track. Knowing the options available to you can help you make the decisions that are best for your financial future. Another way out of the situation is to rebuild your credit with help of excerpts in Rebuilding Credit Kansas City MO.
As the economy continues to struggle to rebound, many people are having financial problems. Making ends meet can be difficult when you unexpectedly lose a job or have wages reduced. Filing for bankruptcy is just one of the options that may be available to you if you are unable to pay your bills.
Most people do not realize that there are costs associated with filing for bankruptcy protection. Some law firms may charge a significant amount of money to handle a bankruptcy for a client, placing further financial strain on the individuals needing to file. This may scare some clients away from the process, and be reluctant to discuss bankruptcy as an option for their situation.
Clients need to know that each bankruptcy attorney will have a different fee system in place. Finding help at an affordable cost is not impossible, as there are options available to you. What is most important is for you to find someone who understands your situation, who can help you determine what is best for you and your family’s financial future.
One thing people need to be aware of is that there are non-attorneys offering to file bankruptcies for individuals. However, working with non-attorneys to prepare your bankruptcy petition could result in problems down the road.
Non-attorneys may not be as familiar with all of the aspects of bankruptcy law, and may miss certain items that would be beneficial to clients. Once the petition has been entered, it can be extremely difficult to make modifications. If property is liquidated to help pay for debts, it will not be possible to undo those types of transactions.
If you are having financial trouble, you need to know that bankruptcy is an affordable option. It is important to work with someone who can walk you through the process and answer all of your questions.
Bankruptcy is one word that terrifies a large portion of the population, but in such a difficult economy, it is becoming a more common occurance. Many feel cornered and strapped financially believing that bankruptcy is their only option.
However, many people in financial trouble may have already exhausted the options that are available in addition to bankruptcy. Some people may wish to consolidate debts, which allow them to make one low monthly payment instead of several monthly payments. This makes the debt more manageable, but doesn’t necessarily reduce the debt that is owed. It may just spread the payments out over time, keeping the financial problems around longer.
Some people may decide to borrow money from friends or family. This is a difficult decision, but it is sometimes necessary in order to stay afloat. Problems could arise here if the borrower is unable to repay the money at a specified time. They may find themselves in danger of being sued, and could face garnishment of their wages.
Clients trapped into bad mortgages may need to consider negotiating with their bank or financial institution. Clients that restructure their mortgages can make the burden of their debt much more manageable, but could potentially be facing foreclosure. Filing for bankruptcy may allow a family to remain in their homes, which could be extremely important for some.
While people may be afraid of the consequences of bankruptcy, it is often because they do not know what really may happen. The negative connotations of bankruptcy may make people feel like they are doing something wrong by filing. That is not true – for some families bankruptcy is the best option that is available for their situation.
Many families have lost precious time and money by trying to avoid filing for bankruptcy and have made their situations much, much worse.
The economic downturn that hit the United States a few years ago has devastated many families. From job loss to foreclosure, many families are struggling to make ends meet. And, many families are doing whatever they can to pay their bills; even to the point that they may not realize that what they believe is debt relief is actually making their debt matters worse.
Barnkrate.com offers some signs that may indicate that people are in or getting deeper into debt trouble:
- Credit card balances are increasing and income is decreasing
- Only paying the minimum amount due on bills each month
- Using new credit cards or cash advances to pay existing credit card debts
- Possessing an increasing number of credit cards
- Credit cards are close to their limits
- Charging more on your credit cards than you are paying
- Working overtime or another job to make payments
- Creditors or collection agencies are calling or mailing letters
- Using credit cards to pay for necessities
- Using savings or retirement accounts to pay bills
- Job loss has you fearful of how you will pay your bills
Experiencing or engaging in one or a few of the signs occasionally is probably not an indication of financial trouble. However, if one or more of these indicators become a pattern, Bankrate.com notes that financial difficulties may exist.
At time it is difficult to ask others for help. But there is help available when your bills have become overwhelming and everything you try to get out of the financial hole only makes the hole deeper. There are many options for relief, including Chapter 7 and 13 bankruptcy.
All too often, the U.S. economic downturn has had devastating impact on individual households. In particular, in the face of job loss or other financial crisis, many people have had to turn to their credit cards to just get by.
And suddenly they can be even as much as tens of thousands of dollars in debt at astronomical interest rates, often behind in payments with huge late fees literally compounding the problem.
Credit-card companies are increasingly suing delinquent debtors in court in attempts to collect these debts, but reportedly the plaintiff creditors are not always crossing their t’s and dotting their i’s. Instead, evidence is emerging of a pattern of shoddy, inadequate or inaccurate paperwork being submitted as evidence in support of the lawsuits, as well as lax compliance with court and other legal procedures.
So credit-card debtors should not automatically roll over if they are sued, assuming that because the financial companies are big, that the companies are doing everything required in the legal proceedings.
Federal authorities are investigating these alleged practices, but in the meantime, it is in a defendant’s best interest to talk to an experienced consumer law attorney about the matter right away to protect him or herself legally and financially.
According to The New York Times, one New York judge estimated that about 90 percent of credit-card suits are “flawed.” Specifically, debtors need to be sure that the claimed amounts due, including interest and fees added, are accurate and correct, among other things. Sometimes an account holder might be sued even after having paid off the debt already.
The New York Times reports further that about 95 percent of these cases result in default judgments against the debtors after they do not show up to defend themselves.
Carrie Frantz, of Walton Legal Services, will be a presenter at an upcoming NBI seminar. This will be a hands-on walk through the foreclosure process and its legal considerations. Please see the attached for further information.
After attorneys general from 49 states investigated a slew of reports that banks were using fraudulently signed documents to speed up foreclosures in court the national mortgage settlement was put into place. There were also complaints of wrongful foreclosures and other issues coming from the banks’ improper handlings of borrower’s accounts. The banks, however, are progressing rather slowly.
Few Borrowers Given Assistance
The settlement was supposed to help one million borrowers and give $10 billion to struggling borrowers in the form of debt relief. The settlement went into effect over five months ago and the banks have only helped 7,093 borrowers by writing off $750 million in first mortgage debt. The banks have a total of three years to complete the terms of the settlement, if they complete it in the first year, they receive financial incentives.
Bank of America is one of the five banks, and also the bank with the highest settlement obligations. This bank, however, had not made any changes as of the end of June according to the monitor of the national mortgage settlement. The Bank of America claims to have given $596 in relief to 3,823 borrowers.
The banks say that the majority of the relief so far is coming in the form of a short sale. A short sale occurs when a bank sells the borrower’s home for less money than is owed on the home. The bank then agrees to not pursue any further action on the property.
Some Say the Settlement is not Enough
Within the housing community there are critics of the settlement. They say that the agreement is not enough to deal with the current housing crisis. They claim that only 10% of outstanding loans will qualify under the settlement. This is because the main mortgage holders in the country, Fannie Mae and Freddie Mac, are not included in the settlement.
Critics also argue that they are skeptical as to whether the banks will perform the agreement. The agreement requires the banks to implement changes to prevent errors and help with other issues the banks were having in regards to the mortgages. Attorneys and housing counselors who are now working with struggling borrowers claim that the banks’ compliance with the new rules is not as good as it should be.
Individuals struggling with mortgage debt or suspect fraudulent bank practices as were involved in the settlement should seek help before the problem gets out of control. An attorney is a great resource for struggling borrowers and those who feel as if they are being treated unfairly by their lender to get back on track.
A recent filing by Grammy Award-winning singer Dionne Warwick proves that anyone can end up in the financial situation where bankruptcy is the best possible debt relief option. The hope for Warwick, 72, is that this bankruptcy filing will allow her to once again take control of her finances.
When looking at what happened to cause the 72-year-old to file for personal bankruptcy , her publicist said her debt is due to “negligent and gross financial mismanagement.” This mismanagement reportedly went on from the 1980s until the mid-1990s.
In her bankruptcy filing, Warwick lists assets at $25,500, while liabilities reach more than $10.7 million. Of the more than $10.7 million, the Internal Revenue Service is listed. This is supposedly due to the fact that while she did owe in back taxes, she has paid up what was owed. However, penalties and interest have continued to pile up, and even though the singer has tried to make payment options with the IRS, an agreement could not be reached.
In looking at this recent bankruptcy filing, there are certainly lessons the average Indiana resident can learn. The first being that debt can happen, even to those with a decent income who think they are financially responsible.
When debts do get out of control, as Warwick’s filing goes to show, bankruptcy is often an option. Depending on the type of filing this can result in debts being discharged or a repayment plan being established. If repayment is the route, filers typically have between three and five years to pay back what is owed.
Lastly, keep in mind that those who are thinking of filing for bankruptcy should talk with an attorney who specializes in debt relief in Indiana. This attorney can help explore different options to maximize the benefits of bankruptcy.
The Great Recession and housing market crash brought with it unprecedented numbers in terms of foreclosures. Not only did the housing crash effect homeowners who really wanted to continue living in their homes, but it also had an impact on neighborhoods as homes now sit vacant.
Part of the issue with these now vacant homes, is not only are these homes susceptible to crime and property damage, but there are plenty of cases where the homeowner still technically owns the property and now owes back property taxes and other fees.
These types of homes have been labeled as “zombie” foreclosures. This is when a homeowner received notice of the foreclosure and moved out, only to find out years later that they still legally owned the home.
According to RealtyTrac, in the past three months there have been roughly 302,000 homes in the U.S. that fall under the category of “zombie” foreclosure. Indiana is one of the states with a high number of these types of properties.
In looking at how this even became a problem, one must look back to 2008 when the housing market crashed and banks were having a hard time re-selling properties. In order to save money on costs associated with foreclosures, the banks would just not officially foreclose on the home. While good for the banks, for the homeowners it has become disastrous. Not only is their credit score now affected by the foreclosure, but the unpaid property tax debt only further drives down their credit score.
For those in Indiana who are either facing foreclosure now, or who are living in fear of a foreclosure, as the “zombie” foreclosure issues goes to show, it is important to talk with an attorney when figuring out what next steps need to be taken. Maybe filing for bankruptcy is the best option in order to just avoid the foreclosure process altogether? Or, maybe getting rid of a second mortgage is the best choice? Either way, an attorney can walk through these scenarios with a struggling Indiana homeowner.
The current economy is affecting more than taxes and jobs in Indiana. Bankruptcies have skyrocketed, home values have decreased, credit card debts have accumulated, and as a result, marriages are in trouble. Money problems are impacting couples all over the United States. As the economy continues to struggle, more and more couples are deciding to divorce, and finances seem to be a key factor or last straw that is helping to end these marriages.
It’s a well known fact that financial problems add stress and strain to even the best of marriages. And while we keep hearing that we are on the road to economic recovery, couples are dealing with the left over realities of the recession and it can be ugly. Young professional couples are often inexperienced when it comes to handling money issues. Many families were living way beyond their means when the economy sank, and now they are finding themselves relying on credit cards or drying up their savings accounts in order to keep afloat. Some are even filing for bankruptcy.
Prolonged financial strain can cause division and hardship on any marriage. As food products, gas and clothing costs continue to spike, couples feel continued tension and pressure when it comes to making wise money decisions. Add in old student loans, accumulated credit card debt, pay cuts, and you have a lot to wade through as a couple. It is imperative that these stretched couples land on the same page.
That is why discussing money issues before they arise is so important. Older couples, who have been married for a long time, seem to ride through financial storms much better than those in new marriages. They have learned to plan and work through tough times. Moving forward and accepting where you are at financially may be the first and best step to surviving this economy with the person you love. Working together may not only help marriages survive this financial crisis, but also emerge in solid financial shape. 4 Test 4