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Chattanooga Bankruptcy Law Blog

Older Americans are filing for personal bankruptcy

Bankruptcy is not a problem only for young people. Tennessee residents may harbor the misconception that financial mismanagement during one's youth is the root cause of economic struggles. However, recent trends in bankruptcy filings suggest that even individuals who have reached retirement age can be affected by surprise bills, unexpected illnesses, and other catastrophes that can destroy their financial health.

According to a recent study, bankruptcy filings for older Americans are up. In 1991, only 2.1 percent of bankruptcy filings involved filers who were 65 years of age or older. However, in 2016 that figure jumped to 12.2 percent.

Tennessee law governs bankruptcy exemption options

Every day American across the country make the difficult decision to pursue bankruptcy to alleviate their financial obstacles. Whether they have fallen on hard times due to medical or credit card debt or have suffered the loss of their income due to a lay-off or downsizing, their choices to seek protections from the bankruptcy laws of the state and nation are undoubtedly made after careful considerations.

For some Americans, choosing to pursue bankruptcy is only the first decision they must make in order to engage with the process. They must then decide what form of personal bankruptcy will serve them best, and it is often the case that this decision is best made with the help of an attorney. Understanding how each form of bankruptcy can affect one's financial future can be difficult and legal assistance can be valuable to those who want to make informed decisions.

Wage garnishment adds to your troubles

Receiving a warning that a creditor intends to sue you to garnish your wages may be the straw that breaks your back. You are already struggling each week to keep your home, your vehicle and the necessities of life. If you have children, you may feel overwhelmed trying to provide them with the things they need and want. A wage garnishment can be a devastating blow to your fragile financial state.

Typically, such a garnishment will not come as a surprise. In addition to the notice you receive of the creditor's intent to garnish your pay, you may already know how far behind you are on your debts. If it has been several months since you have made any payments to a particular creditor, that creditor has the right to seek payment through legal means. Wage garnishment is one of those avenues.

Is Chapter 7 bankruptcy available for businesses?

Under the law, businesses can be recognized as legal entities and, therefore, may have certain rights when it comes to seeking bankruptcy protection. For example, a Tennessee business that has overwhelming debts and cannot turn a profit to repay those obligations may be able to use Chapter 7 bankruptcy to liquidate its assets and repay its loans. This post will briefly discuss Chapter 7 bankruptcy for businesses but, as with all legal matters, readers are asked to seek their own legal advice.

The Chapter 7 bankruptcy process for a business is similar to that for an individual debtor. A business must file paperwork to initiate the bankruptcy process, and after that paperwork is filed, a meeting of the business's creditors will be scheduled. During the meeting, a trustee who has been assigned to the business's case will determine what assets the business has and will take possession of them.

Chapter 13 bankruptcy may help stop foreclosure

The loss of a family home to foreclosure can be a nightmare for a Chattanooga resident. Not only must they struggle to find a new place for their loved ones to live, but they must also contend with the serious financial repercussions that can follow foreclosure proceedings. For individuals who are caught in this difficult situation, help may be available through Chapter 13 bankruptcy.

Chapter 13 bankruptcy is available to individuals who earn income and who, through the reorganization of their debts, can make payments toward the repayment of their obligations. Chapter 13 bankruptcy requires individuals to meet other conditions, and those who read this post and wish to know more about the process are encouraged to seek the support of bankruptcy attorneys.

Medical debt can have a huge impact on credit score

Many medical procedures cannot be avoided. When Tennessee residents must undergo surgeries or other treatments to save their lives and maintain their health, they may not have money saved to take care of the bills they will later receive. This can cause patients to incur medical debt, a leading cause of financial stress for many Americans.

When a medical debt is incurred, a patient has a certain amount of time to pay it off before that debt will show up on their credit score. Specifically, the three largest credit reporting agencies must now wait about six months before they may put a medical debt on a person's credit report. Additionally, if a debt is paid off by the individual's insurance company after it has been placed on their credit report, the credit reporting agencies are required to remove the debt.

Why must I do credit counseling in order to pursue bankruptcy?

Bankruptcy is a legal process and it is not completed without the filer suffering some consequences. For example, after completing the personal bankruptcy process a Tennessee resident may find that their credit is affected and that they are having trouble getting loans. Bankruptcy helps individuals get out from under financial burdens, but it is not an easy process to fulfill.

In order to provide prospective bankruptcy filers with information about their finances and options, individuals who wish to pursue Chapter 13 or Chapter 7 bankruptcy must complete courses on credit counseling. These courses help individuals assess their monetary situations and guide them through their options for getting out of debt with the protection of the bankruptcy court. At the end of one's credit counseling course they may find that they can alleviate their economic burdens without engaging in the process, or they may feel confident that bankruptcy is the best way for them to eliminate their debts.

When life leads to credit card debt, what are your options?

When it comes to your finances, you may relate to many other Tennessee residents who say they've had times of financial stability and also times where they've encountered serious financial challenges. Many have been able to resolve their money problems by devising new savings and spending plans. However, that doesn't always work.  

In fact, you may be among home owners in this state whose financial problems arose due to unexpected circumstances. If something happens that creates an exorbitant expense and you are not prepared to meet it, your entire financial foundation can quickly begin to crumble. This often leads to credit card debt. The good news is that even if you are currently facing a serious financial crisis, there may be several solution options available.  

Protecting financial health when medical debt becomes a problem

Each day presents new opportunities and experiences for the residents of Chattanooga. While many individuals may embrace the positive events that happen in their lives, they may also fear the repercussions that accompany the negative happenings that afflict them and their loved ones. In particular, the diagnosis of a serious medical condition can be a significantly emotional, physical, and financial hardship.

An accident, injury, or illness can come out of nowhere, blindsiding a person who assumed their health was strong and who was not prepared for the costs that would be associated with their unexpected recuperation. They may watch their savings disappear as they pay off their hospital bills, finance their medications, and seek to borrow money to get the treatments and therapy they need to survive.

What are bankruptcy exemptions?

Working through a bankruptcy from filing to discharge may seem daunting for a Tennessee resident. For example, under Chapter 13 bankruptcy, a debtor may have to find a way to commit much of their disposable income to the repayment of their debts. Under Chapter 7 bankruptcy, they may have to relinquish items of their own property to sell for the repayment of what they owe to their creditors.

It may seem as though bankruptcy is a good way to get out from under oppressive debt, but a person will not be left with anything on which to rebuild their life once the process is over. To prevent bankruptcy filers from having to start completely over once they receive their final discharge, they are allowed to exempt certain items and parcels of property from the bankruptcy processes.

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Mark T. Young & Associates
2895 Northpoint Blvd.
Hixson, TN 37343

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