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Middle Tennessee Bankruptcy Blog

The main causes of credit card debt

As most Tennesseans are aware, credit card debt can accumulate in a short period of time, but can take years to pay off. While the spending may have been inevitable, the price one might pay for large amounts of debt can be costly. What are the main causes of debt in America, and how do consumers address this financial blow? 

Pocket Sense points out in an article on credit card debt that not all situations arise as a result of irresponsible spending. Instead, many grapple with debt for a number of complex reasons, including loss of income and emergencies. Unemployment is one of the main causes of credit card debt, since turning to credit card use can be inevitable during this difficult chapter. Of course, emergencies never occur at the right time, and credit cards often come to the rescue. A misunderstanding of one's credit can also invite issues down the road, especially for those who do not pay bills on time. 

Chapter 7 and chapter 13: what is the difference?

Tennesseans currently wading through a sea of debt know all too well that recovering from this financial hit can take a considerable amount of time and effort. Not only does a money issue create immediate complications; it can linger and worsen if unaddressed. Although each situation can be unique, a common question surfaces during this process: what are the main differences between Chapter 7 and Chapter 13? 

Pocket Sense provides an accessible rundown of Chapter 7 bankruptcy and Chapter 13 bankruptcy, explaining that these two routes are the most commonly used among debtors across the nation. The main difference between these two plans lies in the details; while Chapter 13 cancels only the debts that a consumer cannot pay back within a three- to five-year timeframe, Chapter 7 has the ability to cancel the large majority (if not all) of a consumer's unsecured debts. Debtors must meet eligibility requirements in order to move forward with either plan. As Pocket Sense describes, Chapter 7 bankruptcy requires debtors to complete a Chapter 7 test. Chapter 13 places more focus on one's unsecured and secured debts. 

Are creditors trying to take your property? You can fight back.

One of the most frustrating and stressful aspects of dealing with a substantial amount of debt are the phone calls and efforts of debt collectors and creditors to get money from you. Sometimes, these efforts can involve more than just calls and letters – they may even attempt to collect on debts by taking your property.

This action is repossession, and while it may seem inconceivable that a third party could come and take your property, it is possible if you are behind on certain payments. If you are a Tennessee consumer overwhelmed by debt and unsure of how to make the stress stop, it could be helpful to consider the benefits of consumer bankruptcy. 

Understand the difference between bankruptcies before choosing

Most adults in Tennessee have faced financial challenges at some point in their lives. Some have been able to quickly rectify their situations by adjusting their spending habits. If you're currently in the midst of a serious financial crisis, you likely already know that things aren't always that simple. Sometimes, no amount of spending adjustment is enough to overcome major debt.  

The good news is that there are often bankruptcy options available for people in such situations. If you're considering filing for debt relief, there are several things you should know, including the basic differences between Chapter 7 and Chapter 13, so that you can make informed decisions and choose a course of action that best fits your immediate financial needs and long-term goals. 

Student loan debt: a light at the end of the tunnel?

Countless Tennesseans struggle with student debt; some even carry this burden for decades. A financial stressor that can cripple the wallet and affect one's overall quality of life, student loan debt is a topic that has plagued America over recent years. Fortunately, there could be a light at the end of the tunnel.

In February, CNBC noted that President Trump could make it easier to address student loan debt through bankruptcy. The report revealed the Education Department's plans to review the process of discharging student loans -- a step that CNBC called a definite move forward. The review would include a consideration of the ways undue hardship claims affect borrowers; ultimately, they mentioned possibly modifying how those claims would be moderated through bankruptcy. Some argue that "undue hardship" was never properly defined, making it difficult to navigate student loan debt cases. CNBC shares that college-loan balances in the country have skyrocketed to $1.4 trillion -- higher than ever before.

When buying becomes a burden

With the endless stream of weekly deals and the perfect products, overly frequent shopping can be all too tempting. While retail therapy can be cathartic to some degree, there can be too much of a good thing. Some Tennesseans struggle with crippling credit card debt as a result of this habit. Fortunately, there are some steps one can take to bring financial balance back to life again.

Money magazine recognizes the common problem of excessive spending habits, and how they affect a great number of Americans today. Referring to experts to show that shopping addictions are a real problem, Money continues by noting the multifaceted concerns a shopping habit can expose. For instance, not only can a shopping addiction inflict damage on one's wallet; it can also come with serious psychological repercussions. Consumers often display signs of anger, anxiety or regret after making a big spend.

Handling credit card debt when unemployed

There is hardly a more pressing topic than financial uncertainty. Even when the picture is clear, it is easy to become lost in the sea of debt. Although Nashville has recently seen improvements in its unemployment rates, countless Tennesseans still struggle to make ends meet. 

Most could agree that unemployment and credit card debt are no thrilling combination. Some have even dealt with money issues for years on end. Although each financial plan may differ depending on the predicament, there are number of ways consumers can overcome these obstacles -- which, if unaddressed, can ultimately get in the way of one's routine and overall quality of life. 

Tips on Managing Credit Card Debt

If you’re mired in an excessive amount of credit card debt in Tennessee, you might feel like there’s no light at the end of the tunnel. However, there are steps you can take to manage your credit card debt and begin rebuilding your finances once again. The Balance offers the following tips to help you get a handle on your financial future once and for all.

1. Make a List

Factors that may point toward Chapter 13 as your best option

If you were to take a survey to determine how many Tennessee residents have faced serious financial challenges in the past five years, you may be surprised at the high number that would likely result. Even the slightest unexpected life change can throw your finances out of whack. The key to overcoming such problems often lies in how much you know ahead of time about various debt relief options that may be available in a particular situation. 

For instance, there are several types of bankruptcy; however, what works for one person may not be in another's best interests. To resolve financial crises as soon as possible, you need to find the plan that best fits your particular circumstances and ultimate finance goals. If you currently earn reliable income, Chapter 13 bankruptcy may be worth your consideration.  

Factors that may point toward Chapter 13 as your best option

If you were to take a survey to determine how many Tennessee residents have faced serious financial challenges in the past five years, you may be surprised at the high number that would admit to it. Even the slightest unexpected life change can throw your finances out of whack. The key to overcoming such problems often lies in how much you know ahead of time about various debt relief options that may be available in a particular

For instance, there are several types of bankruptcy; however, what works for one person may not be in another's best interests. To resolve financial crises as soon as possible, you need to find the plan that best fits your particular circumstances and ultimate finance goals. If you currently earn reliable income, Chapter 13 bankruptcy may be worth your consideration.

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