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Tyler Texas Bankruptcy Law Blog

Can you stop wage garnishment for credit card debt?

Paying bills is a part of adulthood. One has to pay for housing, food, utilities, and goods. While many are able to live within their means, when circumstances in life unexpectedly change doing so can prove to be difficult. These situations can lead to an overreliance on credit cards. While dealing with credit card debt can be manageable, missed payments can create major financial troubles. This could lead to creditor's coming after you, even intercepting your wages.

Can you stop wage garnishment for credit card debt? The answer depends on the circumstances at hand and the decisions an individual chooses to make. If it isn't already stressful enough to have growing credit card debt, having one's wages garnished for this debt can be especially taxing. Garnishments can occur in one of two ways. It can come directly from a person's wages or it can be seized from the individual's personal bank account.

The AAF files for Chapter 7 bankruptcy

Running a business can be both an exciting and stressful endeavor. While there can be some good times where a business is profitable, when the debts accumulated far exceed the value of the company, financial and operational problems can arise. In order to get through financial troubles and secure debt relief, a business may want to consider pursuing the bankruptcy process.

It was recently reported that the AAF is seeking bankruptcy protection. The control owner of the potential developmental league for the NFL announced that they filed for a Chapter 7 bankruptcy. At this point, the AAF has ceased all business operations and the liquidation process has begun.

Who would benefit from a Chapter 11 bankruptcy filing?

Dealing with debt is not easy. Yet, everyday millions of Americans, many of them right here in Texas, have to cope with burdensome financial circumstances. When debt becomes overwhelming, these financial burdens can make it difficult to live one's life. Debt can have a significant impact on businesses, too. It can be extremely challenging for a business to keep running when debt gets to be too much to handle. This is where a Chapter 11 bankruptcy petition may prove beneficial.

This type of bankruptcy filing is generally intended for to benefit businesses by helping them alleviate heavy debt burdens through debt reorganization. While it is most commonly used by businesses, there are some instances where an individual could file for this type of bankruptcy.

Stopping creditors during bankruptcy process

Financial problems are fairly common in Texas. While some individuals are able to overcome these challenges with slight changes to their spending, others must seek out other debt relief options like bankruptcy. Bankruptcy may be an especially appealing option for those facing constant harassment from their creditors. Filing for bankruptcy can help an individual escape burdensome debt while also stopping creditors from engaging in harassing behaviors.

This is because filing for bankruptcy triggers an automatic stay. This protects a debtor from collection actions taken by creditors and bill collectors. Additionally, it stops any lawsuits that have been filed by a creditor, collection agency, government entity, or any other individual or business seeking money owed.

Guiding you through a Chapter 13 bankruptcy filing

Dealing with financial problems is anything but easy for Texas residents to confront. However, doing so is often necessary for those seeking to eliminate their debt and obtain a fresh financial start. Bankruptcy can offer a real solution for those dealing with major debt problems, but not all bankruptcy filings are the same. Based on a person's current situation and future goals, one type of bankruptcy may be more beneficial than others. Additionally, a debtor may only qualify for one type of bankruptcy filing.

For many, losing certain assets and property, such as a home and vehicle, are the biggest concern when filing for bankruptcy. However, those seeking to eliminate debt should understand that they can obtain debt relief while also keeping certain assets. At the Law Office of Gordon Mosley, our attorneys take the time to explain the bankruptcy processes, thereby helping our clients understand if a Chapter 13 filing is the best option for them.

Credit card debt can get worse after job loss

From a relatively young age, you may have known what career path you wanted to take. You may have gone to the Texas college of your dreams to earn a quality education and later applied for a position that you thought would help you reach your career goals. After you got the job, you may have felt that everything was looking up.

Though you held the same position for years, you now feel that your life is completely off track because you lost your job. No matter the reason behind your unemployment, you now face a serious predicament, especially when it comes to handling your financial affairs. In hopes of handling this unexpected ordeal, you may want to closely assess your credit card debt.

Debt-related anxiety affects nearly half of Americans

If you're stressed out about debt, you're not alone. In fact, a recent study found that 45% of Americans report feeling anxious about debt at least once a month. Another 20% of those individuals feel physically sick at least once a month thanks to debt fears. This anxiety can be crippling, affecting nearly every aspect of an individual's life.

This anxiety isn't surprising given the amount of debt being carried by Americans. Last week on the blog we discussed how Millennials stack up, but other generations are dealing with debt problems, too. While the average debt load is at nearly $30,000, Gen Xers carry $36,000 in personal debt on average. That compares to $28,600 for Baby Boomers and $14,700 for those in Gen Z. With numbers this high, 15% of Americans are afraid that they'll be strapped with debt for the rest of their lives, while another 35% of Americans feel guilty about the debt that they are carrying.

Millenials are sliding deeper into debt

Financial difficulties can strike people of any age and socio-economic class. Although many individuals later in life find themselves with money troubles after suffering the loss of a job or the onset of an unexpected illness, even young adults can find themselves falling into deeper and deeper holes of debt. When this happens, indebted individuals may struggle to see a way out and secure the financial freedom they need and deserve.

This problem may be growing more common amongst young Americans, too. According to a recent study, Millennials carry an average of $28,000 in personal debt. This figure excludes mortgage debt, which makes the number even more staggering. A lot of this debt can be attributable to student loans, but a growing share of this debt comes from credit card use. Some financial experts say that Millennial's are unwilling to forgo a heightened standard of living in exchange for avoiding dead. They claim that this has spurred Millennials to take on more credit card debt then proceeding generations.

Credit card interest rates up, recession threat lingers

Credit card debt haunts many Texans. Oftentimes individuals have to turn these lines of credit in order to make ends meet simply because their wages aren't enough to support them. In other situations, credit cards must be utilized to pay off unexpected medical debt. Others hope to use them as a mere stopgap measure to get them through to their next paycheck. Regardless of why an individual possesses credit card debt, the stark reality is that it can pose a threat to one's future financial stability.

This may be especially true if a recession strikes any time soon. According to reports, credit card interest rates are already at near all-time highs, with the national average settling at 17.61%. This is up significantly from the 13% seen at the start of the Great Recession. Although this may not seem like much of a difference, the fact of the matter is that it can mean thousands in interest costs over the life of a balance with repayment periods that extend for several years more than initially anticipated. Repaying these balances can be even more challenging during a recession when jobs are lost and wages decrease.

Chapter 11 bankruptcy and the small business debtor

Many small businesses in Texas end up falling on hard financial times. Although some of these businesses are able to revamp their marketing tactics, delve into new markets, and expand into new product lines, others are unsuccessful in their efforts to do so. The businesses that fall into this latter category often need financial relief in order survive. They may be able to secure additional loans to help pay off some existing debts, but this strategy can leave a business spiraling deeper into a hole of debt.

These businesses should carefully consider whether Chapter 11 bankruptcy is right for them. Businesses that have less than approximately $2.6 million in debt and have not had a creditors' committee appointed to their bankruptcy case by the bankruptcy trustee may qualify as a small business debtor. A small business debtor must undergo an initial interview with the trustee to ensure that the petitioner's business plan is viable and will allow it to successfully meet federal requirements.

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