Many people in Kentucky use a Chapter 13 bankruptcy filing to protect their home from foreclosure. If you are earning a steady income, a Chapter 13 can help provide that "breathing space" to help you deal with other financial difficulties. It can allow you to repay mortgage arrears in a five-year Chapter 13 plan, and this can both stop a foreclosure proceeding and provide you with the time need to catch up with your mortgage payments.
The leading news story this week related to bankruptcy does not come from Kentucky, but Detroit, which declared bankruptcy last week. This bankruptcy filing was the largest municipal bankruptcy ever, surpassing that of Jefferson County, Alabama. The federal government has not been asked to help Detroit, nor has the city requested help. They claim this is a matter that must be worked out between the city and the state of Michigan.
According to data from the Federal Reserve, consumers across the country are feeling increasingly confident in their financial standings. Credit card debt increased by more than ever in the last year from April to May. Consumers added $6.6 billion to bring the total national credit card debt to $856.5 billion.
Many people who struggle with credit card debt, medical bills, student loan payments and other debts know the aggravation of harassing phone calls from debt collectors. While laws are in place that are supposed to protect consumers from debt collector harassment, many collectors routinely disregard these laws. They often get away with it because people are unaware of their rights.
The crushing burden of student loan debt that many graduates have to shoulder after completing school is familiar to thousands in Kentucky and across the U.S. With the still-stagnant economy, many new graduates are finding it difficult to find employment and cannot make their student loan payments. Many have problems meeting basic living expenses, let alone student loan payments. The New York Federal Reserve reported that about 6.7 million, or 17 percent, of student loan borrowers are in default on their loan payments, meaning that they are 90 days or more overdue in paying.