Rising Consumer Unsecured Debt and Bankruptcy

Consumer debt in Florida and throughout the United States has recently been on the rise. More individuals are spending beyond their means, and often for goods and services that feel like necessities. The cost of groceries has risen sharply, requiring families to spend substantially more money than they used to for food. Utility costs, as well as car payments, housing payments, and medical debt are all increasing. For some consumers, higher costs and the difficulty of paying up front has meant taking on “buy now, pay later” debt through companies like Affirm, Afterpay, PayPal Credit, and Klarna. Others have relied primarily on credit cards with rising interest rates.

According to a recent report from Newsweek, unsecured debt has risen significantly among consumers and the upward trend shows no sign of stopping. If you are among the many Americans with a seemingly insurmountable amount of unsecured debt, can you file for bankruptcy? Our West Palm Beach bankruptcy attorneys can say more.

Unsecured Debt Reaching “Crisis Mode” Status

Hiring is down across the country and prices continue to rise for necessities. As a result, according to the Newsweek report, there is a “perfect storm of financial pressure” that also includes “high borrowing costs” and rising unsecured debt. Consumer spending is expected to increase through November and December as a result of the holidays, with people spending money on (and often using credit cards to pay for) travel, gifts, and other non-essential purchases.

With the rise in unsecured debt and the likelihood that the total unsecured debt across the country will only continue to increase in the months to come, the report suggests that many consumers have now reached “crisis mode.” That idea is supported by the fact that bankruptcy inquiries are also on the rise. As more consumers are realizing that they have debts they cannot repay, they are looking into the possibility of bankruptcy.

Dischargeability of Unsecured Debt in an Individual Bankruptcy Filing

Most unsecured debt is dischargeable in a bankruptcy case — whether you are considering a Chapter 7 liquidation bankruptcy or a Chapter 13 reorganization bankruptcy. In the latter, unsecured debt will usually be dischargeable as long as it is not classified as a priority debt.

The most common types of unsecured debt that Americans owe includes credit card debt, medical debt, personal loan debt, “buy now, pay later” debt, and student loan debt. All of these types of debt can be dischargeable, including student loan debt.

Contact a West Palm Beach Bankruptcy Attorney Today for Assistance 

Are you among the millions of Americans struggling with unsecured debt coupled with increased fees and interest? You may be thinking about a bankruptcy filing if so. If you are considering a personal bankruptcy filing, it is important to seek legal advice. One of the experienced West Palm Beach bankruptcy lawyers at Kelley, Fulton, Kaplan & Eller can discuss your financial circumstances with you today and help you to understand your eligibility for a liquidation or reorganization bankruptcy in South Florida. Once you are ready to file for bankruptcy, our firm can assist you with each step of the consumer bankruptcy process. Contact us today to discuss your case and to get started on your bankruptcy filing.

Source:

newsweek.com/americans-crisis-mode-consumer-stress-bankruptcy-10943041