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Cincinnati Bankruptcy Law Blog

Bankruptcy: When home remedies for debt relief prove unfruitful

When facing extended periods of financial strain, there may be a variety of tactics a person in Ohio or elsewhere can deploy to lessen the burden. In some cases, these strategies could help alleviate a significant amount of one's monetary load. However, should one's efforts to cut down on expenses merely act as a temporary fix to a growing issue, a more long-term solution such as bankruptcy could prove to be just the tool to help achieve a healthier financial future.

When it comes to cutting down on financial obligations, studies indicate that taking stock of current expenses can be helpful. For instance, some might not be fully aware of just how much they spend on services such as cell phone packages. Many individuals may also be unaware of the toll unnecessary expenses such as frequently dining out or going to the movies could have on their situation.

Average household debt rises for 20th consecutive quarter

A surging economy may have a way of leaving individuals in Ohio and across the nation less hesitant to take on additional financial obligations. While having confidence that one will be able to afford payments on accounts can be an encouraging feeling, there is always a risk that circumstances could change. With reports indicating that debt levels have continued to increase for 20 consecutive quarters, it could take little more than a minor change in circumstance to leave many families facing financial hardship.

Recent reports indicate that the average household debt across the nation reached levels of $13.86 trillion in the second quarter of 2019. These reports indicate that debt levels increased by $192 million in this quarter alone. While auto loans and credit card debts both play a part in this increase, studies suggest that with lower average interests rates during the second quarter, mortgage loans continue to be a rising concern for many.

Is bankruptcy a good way to tackle medical bills?

Unfortunately, it's common for people in Ohio to deal with massive medical bills that feel overwhelming and impossible to pay. Having these debts hang over you can feel like a huge burden. It can lead to feelings of constant anxiety and even depression. However, some solutions are available to debtors from all walks of life. Filing for bankruptcy can, in many cases, be a great choice when it comes to wiping the slate clean regarding medical bills.

Statistics show that between 25% and 50% of all bankruptcies include a significant amount of medical debts. Whether you have acquired medical debt due to urgent surgery, long-term treatment of an illness or injury, or because of cosmetic surgery, you will have an equal chance of being successful through a bankruptcy filing.

Timing as an issue in debt collection attempts

Many individuals in Ohio and elsewhere may worry that their outstanding financial obligations will continue to haunt them throughout life. While as time passes, a person's debts might not disappear entirely, there may be restraints on the type of action creditors can take to seek payments on debts. However, should a debt collection agency convince a person to make any form of payment on an old debt, creditors may argue that the statute of limitations no longer applies.

With certain forms of debt, creditors may only have so long to take legal action against a debtor before the statute of limitations kicks in. Once this period has passed, a creditor may no longer hold the right to seek restitution by filing a lawsuit against a person. However, this might not always stop creditors from reaching out and attempting to collect on old debts and should a person make even a small payment on the debt, this form of protection may cease to apply.

Distinguishing between good and bad debt might not always be easy

Debt can come in a variety of forms, some of which could prove helpful by assisting a person in reaching long-term goals. However, certain forms of debt might provide little benefit and instead only leave a person in Ohio facing an uphill financial battle for years to come. By asking certain questions, one might be able to identify which category a financial obligation may fall under. Unfortunately there are certain scenarios in which even a seemingly helpful debt could lead to monetary strain.

One of the first questions to consider before taking on debt could include asking whether such an obligation will help one achieve a long-term goal. For instance, a mortgage may help a person pursue his or her goal of owning a home. Before taking on debt, one may also benefit from asking if the decision is necessary or merely convenient, as taking on certain obligations out of convenience might not always be a healthy choice.

Knowing the options when dealing with business debt

Many business owners in Ohio and across the nation may feel that taking on debt is an inevitable part of starting and running a company. However, high amounts of debt can place a significant strain on a company's future. Owners who encounter prolonged struggles with business debt may benefit from seeking guidance on how to reduce financial obligations and how to know when it might be time to consider exploring the available options for debt relief.

According to studies, one of the first steps to take when dealing with high levels of business debt involves examining the company's budget. Taking a closer look at the current budget could help owners identify areas in which budget cuts might be possible. While examining the budget, evaluating operational costs and reducing company expenses where necessary may also prove imperative.

Issues with overspending and credit card debt may go hand in hand

There are a multitude of circumstances in which going into debt may be unavoidable, or even necessary. However, sometimes the monetary struggles individuals in Ohio experience could simply be the product of overspending. Those who wish to stave off debt may find it helpful to understand the most common scenarios in which financial challenges arise and the challenges such struggles can bring about.

When it comes to issues with overspending, many experts contribute a significant portion of similar concerns to the frequent use of credit cards. Studies indicate that many Americans have fallen victim to the luxuries of using similar accounts to fund purchases they would otherwise be unable to afford. Placing purchases that might not always be necessary on an account with interest rates ranging anywhere from 10% to 30% might not always be the healthiest financial decision.

Understanding how issues with debt could impact one's goals

There are many individuals in Ohio and elsewhere who have goals in mind for their future and achieving these objectives may seem a vital part of life. Unfortunately in some cases, issues with debt could threaten to derail some of one's plans for life ahead. As such, those who encounter high levels of debt may find it essential to focus on forming a strategy for relief early on so they can shift their focus back toward building a brighter financial future.

Studies indicate that one area in which debt could prove troublesome pertains to the impact it can have on one's ability to reach certain financial goals. Financial concerns could place a burden on objectives such as owning a home or helping the kids seek a higher education. In addition, the idea of entering the golden years of life while saddled with the weight of monetary obligations could also be an intimidating concept.

What financial mistakes lead to bankruptcy?

Those who file for bankruptcy are usually forced to do so after making a series of unwise decisions. While none of us can predict the future or avoid mistakes completely, it can be possible to avoid debts by planning ahead and strategizing for the future in Ohio.

If you are worried about the debts that you are facing or if you are feeling growing pressure from creditors, it is important to think carefully about how you react. Many people go into a state of panic and desperation, meaning that they act irrationally and make poor decisions that could lead to further debts. By learning about the most common mistakes made by debtors, you will be more empowered to make better choices in regard to your own finances.

1 arrested during investigation into debt collection scam

Many individuals in Ohio and across the nation may feel that one of the toughest aspects of being in debt pertains to dealing with constant phone calls and letters from collectors. This part of the process may increase in difficulty due to the recent rise of debt collection scams. One person has been arrested during an investigation into a recent operation in which he was accused of posing as a city marshal to collect payments from taxi cab drivers.

According to reports, the man developed a scheme to make money off taxi drivers who were behind on car payments back in 2016. He would reportedly contact these individuals and pretend to be a city marshal. Using the influence of his alleged position, he reportedly prayed on a multitude of victims and seized taxis and medallions from an unspecified number of cab drivers.

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