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April 15, 2019

How to Escape Debt

For many people, debt is source of great stress, anxiety and concern.  As the economy has improved, consumer debt has also increased at an alarming rate. Recent data shows that the total pool of consumer debt has now surpassed $1.3 trillion. The median student loan debt for a person who has attended college is now more that $49,000.  The average household credit card debt is $5,000, while the median has surpassed $16,000. Total average debt, including mortgages and car loans, is $139,500 per household. These numbers continue to increase.

In order to conquer your debt problem, you need to develop a strategy. Here are steps to get you started:

Step 1:  Know the Numbers

It is impossible to develop a strategy to solve a problem if you do not know what the problem is.  Most people do not know what they owe, the repayment terms, or interest rates. The first step to solve a debt problem is to determine exactly how much debt you have and what the repayment terms are.  It is also important to know your household income and basic living expenses.

Step 2:  Make a Plan and Set Goals

Once you know the numbers, you can develop a plan to start paying down your debt.  You need to set goals. Establish a target date for when you want to be out of debt and move backward from that point.  This will enable you to determine how much you will need to pay each month to accomplish your goal.

Step 3:  Review Your Budget

It is easy to lose track of where your money is being spent.  Take the time to review your budget and cut any unnecessary expenses.  Every dollar you find in your budget can be used to pay down your debt faster.  

Step 4:  Stay Focused

While it is easy to get excited about paying off your debt, it can be difficult to maintain this motivation over an extended period of time.  Set a few short term goals and keep progress charts. Include friends in your plan and ask them to hold you accountable. Remind yourself that the process will take time, but the benefits will be worth it.

Debt shouldn’t define you.  Excessive debt will impede every aspect of your life.  You must deal with your debt problem to regain control of your financial future.  Remember that Bishop Law Offices is here is help you. If you are struggling to resolve debt issues on your own, please call our office for a free consultation.

April 15, 2019

Common Reasons People File Bankruptcy

Hundreds of thousands of Bankruptcy cases are filed every year.  Most are Chapter 7 and Chapter 13 Bankruptcy cases that are filed to stop foreclosures, recover repossessed vehicles, and cancel unsecured debts such as credit cards and medical bills.  The reasons for these bankruptcy filings vary, however the most common reasons are as follows:

Many people have suffered a job loss, illness, accident, or some other negative event that has left them with the inability to afford monthly payments on their debt obligations. Once default occurs, debt collectors begin the process of collection.  Relentless phone calls, emails, and letters force people to take action to get relief from these harassing collection efforts.  Filing bankruptcy provides people the relief they need.

Overwhelming credit card debt is also a common reason people file bankruptcy.  With interest rates in excess of 20%, it is extremely difficult to resolve this debt once balances reach $10,000 or more.  Fortunately, bankruptcy provides people the ability to get out from under this crushing debt.

Finally, collection lawsuits cause many people to seek relief by filing bankruptcy.  Once a creditor has obtained a judgment, they have the ability to garnish wages, levy bank accounts, and seize personal property.  These actions can leave people in a devastating financial circumstance. Fortunately, filing bankruptcy immediately stops these actions and prevents all future collection efforts.  At Bishop Law Offices, we have dedicated team focused solely on representing people in Chapter 7 and Chapter 13 Bankruptcy cases.  Whether you are experiencing a situation previously discussed, or are considering bankruptcy for a different reason, we are here to help you.  Please call to schedule a free consultation to discuss the specifics of your situation.