Bankruptcy has been a serious concern throughout the nation, especially in the years following the 2007 recession. While the rate of filings has finally begun to decline on a national scale, the greatest levels have been recorded in states in the South. Texas residents considering bankruptcy may not be concerned with national statistics, but they may want to evaluate the personal benefits and challenges related to proceeding with this action.
The Supreme Court recently ruled in a bankruptcy case that might interest some Texans. The decision was handed down in May, reversing an earlier decision from the U.S. Court of Appeals for the Fifth Circuit.
According to a survey conducted in part by the National Foundation for Credit Counseling, people in Texas and around the country are trying to save more money but also have larger credit card balances. Of 1,600 people in that survey, 10 percent said that they carried more than $2,500 in credit card debt each month. Overall, consumer credit debt increased $3 billion in February following a sharp rise in the last quarter of 2015.
Texas residents who are facing foreclosure have a number of options when dealing with this situation. By learning about their rights and which options are available in their particular situation, they can make more informed decisions about how to proceed.
Data from Epiq Systems shows that the number of bankruptcies in the first quarter of 2016 fell 5 percent from the same time period in the preceding year. That translates to 195,565 commercial and noncommercial filings between Jan. 1 and March 31. While the overall rate of bankruptcy declined, there was a 24 percent increase in commercial filings as well as a 9 percent increase in Chapter 11 filings by businesses.
According to a variety of sources, it may be best to hold off paying a medical bill until it can be checked for accuracy. A study conducted in 2014 by NerdWallet found that there were errors on 49 percent of all Medicare claims. Advocacy groups such as Medical Billing Advocates of America found that the error rate is as high as 80 percent on all claims.
As people prepare to file their taxes, they are likely to go over their finances. Many individuals will start to look at what they owe and discover that they are more deeply in debt than they had assumed. There are a variety of ways that a person can eliminate or drastically lower the amount of what they owe to creditors, including selling things, consolidating debts or negotiating with creditors.
In 1898, the first permanent bankruptcy legislation was enacted by the U.S. Congress. Many scholars believe that it was designed to help businesses handle their debts. Today, bankruptcy is used by both businesses and individuals in Texas and around the country. However, in many cases, it may actually be easier and cheaper for a debtor and a creditor to avoid going to bankruptcy court.
Texas residents may be interested to learn that actress and reality television star Tori Spelling has been sued for an unpaid debt. According to a Jan. 21 report, Spelling is facing a lawsuit from American Express for unpaid debts. Sources have also reported that Spelling's husband, Dean McDermott, is urging her to file for personal bankruptcy.
Although credit cards can be helpful for addressing short-term expenses, many Texas residents find that as interest accrues, payments become increasingly difficult to manage. This is especially true if there are many accounts in question. Medical bills and other debts can exacerbate the problem of managing debt, and bankruptcy may offer a consumer an avenue of escape. However, filing for bankruptcy can involve many negative consequences, making it important to carefully evaluate the pros and cons.