A recent study conducted and published by Urban Institute found that an estimated one in three adults in the United States have at least one delinquent debt that is “in collections.” The study was also featured on CNN Money (link).
The study included many different kind of debts such as credit card bills, medical bills, car loans, parking tickets, but specifically did not examine mortgage debt. It is a stark reminder that millions of Americans are in financial distress.
The consequences of having delinquent debts in collections can result in collection phone calls, lawsuits, wage garnishments, employment issues, restricted access to mortgages, and potentially increased insurance costs. Additionally, financial distress often creates stress and pressure on a person’s relationships. Another consequence of delinquent debts and collection actions is the feeling or loss of control over one’s financial life. High interest rates, late and collection fees can cause bills to grow in to insurmountable debts that can stay with you forever.
Bankruptcy is the opportunity to claim back control over your financial life.
Filing bankruptcy stops all collection actions immediately and allows you to protect assets from creditors and bill collectors. Many of the very debts the study examined can be wiped out or discharged completely in Chapter 7 bankruptcy. For those Americans facing crushing medical bills or mounting credit cards, bankruptcy may be the opportunity for a “fresh start.”
If you are facing collections actions such as harassing bill collectors, collection calls, wage garnishments, lawsuits, repossessed cars or home foreclosure, speaking to an experienced bankruptcy attorney may be in your best interest.
The Sader Law Firm has helped families, individuals and businesses reclaim their financial lives in Kansas City since 1997. Call our one of our bankruptcy lawyers for a free consultation, so we can discuss your bankruptcy options and how bankruptcy might help you.