 With the struggling economy, many people are finding themselves deep in credit card debt. Therefore, consumers are forced to turn to debt consolidation in order to get control of their finances. However, before a person decides to consolidate their credit card debt, they need to be aware of the credit... |
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Living with debt is by no means easy. There’s the constant concern of living paycheck to paycheck and the never ending issue of covering monthly bills and living expenses. While most of us pride ourselves on being self-sufficient, it’s hard to ignore that we all sometimes live well beyond our means.... |
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| Missouri |
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When Congress overhauled bankruptcy law in 2005 the purpose was to diminish the amount of personal, consumer filings and to encourage overwhelmed debtors to seek other alternatives to their financial problems. Some of the leading ways to avoid bankruptcy include credit counseling plans and debt settlement negotiation programs, which most but not all creditors would prefer consumers pursuing instead of bankruptcy. So who do you think pushed strongly bankruptcy reform? You guessed it – the credit card companies! What’s Different About The New Bankruptcy Laws 1) It’s more difficult to file – whether it’s the credit counseling requirement or the increase in the fees, Congress intentionally made it much more time consuming and expensive to file. 2) It’s more difficult to declare Chapter 7 bankruptcy – Typically more of your debt is forgiven in a Chapter 7 versus a Chapter 13 bankruptcy. Under the new laws, consumers who earn more than the median income in their state are required to “pass” the bankruptcy income test, also known as the means test. For Missouri, here’s the median income information as of 2006: 2-person families: 47,589 3-person families: 54,914 4-person families: 63,274 5-person families: 63,346 6-person families: 60,257 7-or-more-person families: 60,721 Due these changes, as well as the credit consequences of filing bankruptcy, more consumers are turning to the debt options mentioned above. If you fit into this boat, submit a form to get a free consultation from a debt advisor. You can also check out some of the articles we have pertaining to credit & debt in Missouri: Missouri Consumer Credit Counseling Services Missouri Bankruptcy Laws Missouri Debt Collection Bankruptcy Data in Missouri 2004: 37,251 2005: 52,060 2006: 15,423 Missouri is a state that historically has had high rates of consumer bankruptcy relative to the other 50 states. Despite this fact, the number of filings dropped significantly in 2006 from 2005. Of course, underlying this trend is the passing of the new bankruptcy law requirements which makes filing Chapter 7 much more difficult from an eligibility standpoint. In a Chapter 7 bankruptcy, your debts are discharged after the sale of your non-exempt assets. Typically this means that a debtor can become totally debt free without paying their creditors much. With the new law, however, more consumers are being forced into Chapter 13 reorganization plans, where the debt is paid back from the debtor’s monthly disposable income over a period of three to five years. As a result, more Missouri consumers have increasingly sought out debt advice from third party consolidation companies. |
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Credit is a useful tool and when handled responsibly allows us to obtain credit cards, loans for homes, cars and other big ticket items. The better we handle our credit, the better the terms that are offered to us from lenders including higher credit lines and lower interest rates.
If, however, a... |
The dismal economy is having an adverse effect on people around the globe with millions facing tremendous amounts of debt. For many, escaping their debt seems like a far off dream but it doesn't have to be! By applying a few simple guidelines to your spending habits, you can begin to reduce credit card... |