Attitude Shift Seen Among Bankruptcy Filers

A blog post on Bankruptcy Corner that cites a story from the Detroit News says that consumer credit counselors have noticed a shift in attitudes about bankruptcy.

The counselors tell reporters that more people who are considering filing for bankruptcy think of it not as a personal failure, but a “product of the times.”

The report comes from Michigan, which has seen its bankruptcy rates increase exponentially with declines in the housing market and auto industry hitting the state hard.

Michigan ranked fifth in per capita bankruptcy filings in 2008, according to statistics released by the Administrative Office of the U.S. Courts, which keeps records for the U.S. Bankruptcy Courts.

Georgia was third in per capita filings in 2008 with 6.35 filings per 1,000 residents, and bankruptcy filings continue to rise in the Atlanta Metro area. 

Economic Crisis May Increase Bankruptcy Filings

Atlanta, Georgia has had an increase in home foreclosures over the last several months with over 10,000 lender-owned properties up for auction last month alone. The jobless rate in the metro Atlanta area has also increased to 8.7 percent this year. This unemployment rate is at the highest level it has been since 1976 when jobless measurements rates were first standardized and tracked. The combination of unemployment, home foreclosures and the current economic downturn may continue to cause people not to be able to pay their bills.

If you are unable to pay your home mortgage and face an economic crisis, it may be necessary to contact a Atlanta Bankruptcy attorney to discuss your option of filing for Atlanta personal bankruptcy. Personal bankruptcy is the legal process of selling or surrendering your assets to pay your creditors. An Atlanta Bankruptcy lawyer can help you understand the current bankruptcy laws for filing an Atlanta bankruptcy.

The two most common types of Atlanta Bankruptcy filings that an Atlanta Bankruptcy attorney can help you file are Chapter 7 Bankruptcy and Chapter 13 Bankruptcy. Chapter 7 Bankruptcy is a liquidation of all the non-exempt property you own. Your Atlanta Bankruptcy Lawyer can help you identify and disclose your non-exempt debt and establish a trustee to liquidate all of the assets.

Chapter 13 Bankruptcy is another Atlanta Bankruptcy option. Unlike Chapter 7 Bankruptcy, it does not relieve your debts immediately, but will give you some relief from debt collections efforts and is supervised by the federal bankruptcy court. It is important if you are filing Chapter 13 bankruptcy in Atlanta to discuss your options with an Atlanta Bankruptcy lawyer.  An Atlanta Bankruptcy attorney will work with you to outline a three to five year debt repayment plan to repay your creditors. The benefit of Chapter 13 Bankruptcy is to help individuals keep their home and stop the home foreclosure process. Home mortgage payments must still be paid during the Chapter 13 Bankruptcy three to five year repayment period. Under Chapter 13 Bankruptcy laws you will be protected from creditor contact and harassment and you will instead work directly with your trustee who will receive all debt payments and redistribute them according to the bankruptcy repayment schedule.  

The type of Atlanta bankruptcy you will want to consider filing and discussing with you Atlanta Bankruptcy Attorney will depend on your personal financial goals. If you want to liquidate your personal debt and start over you may have the option to file Chapter 7 Bankruptcy. If you have a home or other assets that you want to keep and you do not qualify for Chapter 7 Bankruptcy, you may want to discuss the option of Chapter 13 Bankruptcy with you Atlanta Bankruptcy Attorney.

 

 

Death Won’t Stop The Debt Collector

Even though the person that is contacted usually has no obligation to pay the debt, collection companies are finding that the one group that is still paying their bills are the dead.

Collecting debts from dead people is a growth industry. Debt collection companies are benefiting from improved database technology that allows them to file timely claims on the estates of deceased debtors.

If there is no estate to probate, the companies are using the human touch, calling heirs and asking if there will be payment on the debt. 

A consultant to the debt collection industry told the New York Times that the relatives of the deceased usually pay the debts in an effort to let “the dead rest easy, knowing that their obligations are taken care of.”

If asked, the collector will confirm that the relative has no obligation to pay the debt with their own funds, but it isn’t disclosed upfront.