The rate at which Massachusetts residents and others are filing for bankruptcy is dropping. However, there were still 772,594 bankruptcy filings during a 12-month period that ended in June 2017. One of the main reasons why people file for bankruptcy is because they lost their job. Typically, an individual didn't have enough money to cover his or her mortgage, car payment and other expenses. Ideally, a person will have an emergency fund that can last for up to 12 months.
People who file for personal bankruptcy typically do so because they cannot pay their bills with their current earnings and assets. However, many people who seek relief from the Massachusetts bankruptcy courts have some money saved for retirement. Bankruptcy laws protect some retirement accounts from being liquidated, but there are circumstances that could cause a person to lose all or some of their invested savings.
An increasing number of people in Massachusetts are falling behind on their credit cards. This is concerning for banks because it may indicate that more delinquencies may also occur with other types of loans.
Some Massachusetts consumers may be interested in debt consolidation as a solution to financial problems. While this can be helpful, if the person's underlying problem is overspending, debt consolidation might not be the answer.
Debt collection companies in Massachusetts and around the country are forbidden from using deceptive or abusive tactics to collect money by the Fair Debt Collection Practices Act. The federal law applies to companies that collect unpaid bills on behalf of others, but the debt collection industry has changed greatly since its passage in 1977. Companies today often buy tranches of delinquent debts for pennies on the dollar, and consumer rights groups have called for the provisions of the FDCPA to be applied to these businesses also.
When individuals in Massachusetts are facing financial problems, they will likely want to resolve these issues as fast as possible. The problem is that oftentimes there is no quick fix when it comes to problems with debt. There are, however, mechanisms to help debtors enter a path for debt relief. And, when individuals finally decide to file for personal bankruptcy, it is important to keep a few factors in mind along the way.
Bankruptcy can be a terrifying word for Massachusetts residents who are burdened with debt. Many people in this situation wrongly believe that a bankruptcy proceeding will strip them of all of their assets, including their house and automobiles. However, with the right approach, the outcome of a personal bankruptcy can be far less ruinous.
One of the worst things about being in debt is the anxiety and stress it creates. It's hard to enjoy life when you are constantly worried about how you are going to pay the bills. It's exhausting to always have to choose between paying the electric bill or the credit card bill.
Most people in Massachusetts hope to retire someday. But, for an increasing number of people, the retirement years are becoming years of financial challenges. One statistic that reflects this is the rising number of elderly Americans who are filing for bankruptcy.
In a Chapter 7 bankruptcy, the debtor's non-exempt assets can be sold to pay creditors. Sometimes a debtor who anticipates filing for bankruptcy will transfer an asset to another person, to avoid having the asset become part of the bankruptcy estate and subject to a creditor's claims. This is known as a fraudulent transfer, and under either the Bankruptcy Code or Massachusetts law, the bankruptcy trustee can generally undo the transfer and recover the asset for the estate.