Debt is an issue that affects most of America, and North Texas is no different. The residents of North Texas, including the Dallas and Fort Worth, are amongst the United States' leaders in low credit scores and average consumer debt. According to Experian, Dallas is second only to Seattle in average amount of consumer debt amongst the 20 largest metropolitan areas in the U.S.
Experian released a report in March of 2010, stating that Americans had an average of $24,775 in debt and residents of the Dallas area had an average of $26,599 in debt - excluding mortgage debt.
Residents of the Dallas area also had below average credit scores, with a VantageScore of 719. This ties the residents of the Miami-Fort Lauderdale area for the lowest VantageScore among the 20 largest metropolitan areas in the U.S. The nation, on average, has a VantageScore of 749.
There May Be Help
Even though many residents of the Dallas area are carrying heavy debt, there may be help available through Chapter 7 or Chapter 13 bankruptcy.
Chapter 7 Bankruptcy
Chapter 7 bankruptcy is designed to give a debtor a fresh start by discharging most debt. In a Chapter 7 bankruptcy, the debtor is allowed to keep "exempt" property, which is much more than just a car for each driver and a home.
To qualify to file for Chapter 7 bankruptcy, a debtor must pass a "means test." The means test is a formula designed to limit Chapter 7 bankruptcy to those who have no means of paying their debts. If a debtor cannot pass the means test, Chapter 13 bankruptcy may be the option.
Chapter 13 Bankruptcy
Often called the "wage earners' bankruptcy," Chapter 13 bankruptcy, offers debtors a chance to rearrange their debts into one monthly payment to be paid over three to five years. Once the repayment period is up, the remaining debt is discharged.
Much like Chapter 7 bankruptcy, Chapter 13 bankruptcy allows the debtor to keep their exempt property, including their home. If a home is in foreclosure, filing for Chapter 13 bankruptcy will stop the foreclosure and allow the debtor an opportunity to catch-up on past due payments over the life of the repayment plan.
It is very rare that the debtor under either chapter would lose any property or asset, unless they just wanted to surrender it to avoid having to pay for it to the secured creditor.
Discuss Your Options with an Attorney
Bankruptcy may be an option for you if you are carrying a large debt load. An experienced bankruptcy attorney can evaluate your situation and help you decide whether bankruptcy is in your best interests. For questions or for more information, contact a skilled bankruptcy attorney.
