Eliminating Household Debt through Personal Bankruptcy
Household debt has reached a new high, and many American households are tipping toward delinquency, according to a recent report from Advisor Perspectives. As more Florida households struggle to pay their bills, they often take on additional credit card debt to pay for necessities such as food and utilities, and many are also getting very behind on mortgage payments. For anyone in South Florida who has more debt than they can manage, it may be time to consider bankruptcy options.
The prospect of bankruptcy can produce anxiety for many individuals, yet it is important to know that there are numerous benefits to bankruptcy, and there are also many misconceptions that might be preventing you from making a decision about bankruptcy that could help you in the long run. Our West Palm Beach bankruptcy attorneys can tell you more about the benefits of considering bankruptcy when you are struggling with household debt.
Household Debt is Rising, and Debtors Are Struggling to Repay
Over the last year, household debt in the United States rose by about $191 billion, or 1.03 percent, resulting in a total of $18.78 trillion in household debt. The largest portion of that debt is mortgage debt, but it also includes credit card debt, auto loan debt, health care debt, and student loan debt, among others.
According to Advisor Perspectives, credit card debt, student loan debt, auto debt, and mortgage debt are at the highest they have been since 2008. And a significant percentage of this debt is nearing delinquency or has become delinquent, meaning that debtors are late making payments — 120 days late or more for debt that has become delinquent.
Personal Bankruptcy Options for Having Household Debt Discharged
How can personal bankruptcy help you with household debt? There are a couple of key answers.
First, whether you file for a liquidation bankruptcy or reorganization bankruptcy, most types of household debt can be eligible for discharge. If you file for Chapter 7 bankruptcy, you may be able to have your household debts discharged in a relatively short period of time. If you file for Chapter 13 bankruptcy, a discharge will come at the end of the repayment period — three to five years — but you can use that time to catch up on other debts that you do not want discharged.
On that note, one of the major benefits of Chapter 13 bankruptcy when it comes to household debt is that this type of bankruptcy can stop foreclosure and allow you to keep your home. As such, this might be the best bankruptcy option for you if you are struggling with household debt and at risk of losing your home.
Contact a West Palm Beach Bankruptcy Attorney for Help with a Personal Bankruptcy Case and Household Debt Discharge
If you are struggling with household debt, you might want to start looking into bankruptcy options that are available to you, or to you and your spouse if you want to file jointly. As we discussed above, many families in Florida and throughout the country are struggling with household debt while the costs of necessities continue to rise as a result of inflation and other factors. You may be eligible for a liquidation bankruptcy that can give you a fresh start within approximately four to six months of filing, or you may want to consider a reorganization bankruptcy, especially if you are also facing the possibility of foreclosure and want to keep your home. One of the experienced West Palm Beach bankruptcy lawyers at Kelley Kaplan Delaney & Eller, PLLC, PLLC can help. Contact us today to get answers to your bankruptcy questions or to begin working on your bankruptcy petition.
Sources:
law.cornell.edu/uscode/text/11
advisorperspectives.com/dshort/updates/2026/02/17/household-debt-credit-report-q4-2025
