Losing your job because of illness or injury sends you into a downward spiral. Your income stops when you lose your job. In some cases, workers' compensation payments help, but they usually aren't what you need to cover the basics. Add in the medical bills that you might have coming in and the situation can get dire. If you are facing a sea of debt, you have options to consider. Bankruptcy is one of those options.
One type of obligation that can have serious financial consequences for people is medical debt incurred due to an unexpected medical problem or accident. While people may pay off the debt or settle with the medical provider or collection agency, the debt may remain on their credit report, negatively impacting their rating for years.
If a resident of Pennsylvania would like to borrow money to attend school but has filed for bankruptcy in the past, chances are good that they will still be able to receive a student loan. Although declaring bankruptcy does not look good on a credit report, doing this does not disqualify individuals from applying for all types loans.
Using credit cards can create financial challenges especially if consumers do not watch their spending and do not understand how interest is calculated. Credit card users with consumer debt who experience unemployment, reduced income and increased expenses may face creditor harassment because of delinquent payments. Consumers in Pennsylvania and across the country who are making only minimum payments on a credit card to their credit card company could benefit from understanding how credit card interest is calculated.
While filing for bankruptcy might sound like a frightening thing to do, more than 1.2 million people in Pennsylvania and across the nation have sought federal protections, according to a recent report. Whenever people declare bankruptcy, they are usually trying to find a way out of uncontrollable or unmanageable debt.
Despite the few disadvantages of filing for bankruptcy protection, there are numerous advantages. Chapter 7 bankruptcy can eliminate many debts without requiring the Pennsylvania filer to pay anything toward the outstanding balances. Although some debts, such as student loans, alimony and child support cannot be discharged in bankruptcy, eliminating consumer debt and medical bills might make it easier to make the payments on educational debts and family obligations.
Elderly people who reside in Pennsylvania and across the nation are increasingly falling prey to harassing debt collectors, some of whom may be using illegal methods in their attempts to collect the debt, according to a recent report. To keep from becoming a victim to an over-bearing debt collector who may be trying to make a profit off them, seniors who feel threatened should be aware of their rights.
Pennsylvania residents may not have heard about the recent recommendations from the Federal Trade Commission about ads in newspapers, telephone directories and magazines discussing the consolidation of debt. According to the FTC, consumer debt is at an all-time high and individuals should use caution when a seemingly quick fix is offered in a publication. Many companies offer the assurance of debt relief; however, often the bankruptcy option is recommended, which can cause a long-term negative impact on a person's credit history and stays on a credit report for 10 years. This can result in difficulty being able to get insurance, housing, credit and even a job for years to come.
For Pennsylvania debtors, the statute of limitations on unpaid credit card debt may come as a welcome relief. Statutes of limitations prevent debt collectors from filing civil lawsuits against a debtor beyond the time period set forth therein. Debtors should be aware, however, that the statute of limitations does not prevent the creditor from seeking to collect on the debt in other ways.
While many Pennsylvania residents understand that financial pressures can become burdensome, there are certain restrictions in filing for Chapter 7 bankruptcy as a way to obtain a fresh financial start. Income and household expenses are evaluated to determine whether Chapter 7 is appropriate or whether it would be an abuse of the financial system. Means testing is an important element of filing for bankruptcy, and forms must be filled out accurately and submitted with the petition.