THE difficult financial times caused by the pandemic are pushing strapped consumers to the edge. Delinquents and balances on delinquent credit cards are rising again. Faced with layoffs and difficult economic times, many people use their credit cards to pay for basic living expenses such as food and housing. Many people tap into their credit cards hoping it’s just a temporary solution “until things go well”. The bad news is that credit cards have a steep price tag attached- high interest rates, not to mention late fees and over-the-limit fees.
When credit cards run out, some people take more desperate measures just to meet needs. Recently, I’ve seen a lot of people reach out to get some of these so -called “payday” or “emergency” loans, which are ten to thirty times worse than credit cards! In most cases, interest rates on these loans can be anywhere from 390% to 900% APR if you continue to “roll over” the loan (i.e., ask for an extension of time to pay. ) !!! Do you believe? I have seen clients with 2, 3 or sometimes more payday loans at once. No wonder these people are crazy before payday comes! “Loan sharks” often prey on people who are in bad debt and are already in excess.
If you are struggling with debt, you will probably find it more and more difficult to catch up each month. If some of your accounts are transferred to collections, it’s even worse because it means your creditors can sue you at any time. When they get a judgment, lenders can garnish your wages or charge your bank accounts. Some people are paralyzed with fear and do nothing, hoping that somehow by ignoring their debt problems, lenders will simply give up. Be honest. You cannot ignore your debt problems. If you do nothing, one of these days you will find that your inaction has only exacerbated your debt problems.
If you’ve done everything you can but nothing has succeeded up to this point, should you file for bankruptcy as a last resort? Losses are often an option for many people who can no longer afford to pay their debts. In Chapter 7, credit card debts, personal loans, medical bills and most types of unsecured debts can be eliminated. That means you can start over and rebuild your credit instead of reporting all of your delinquent debts to credit bureaus every month. Your fresh start will begin the day your bankruptcy case is filed and lenders can no longer collect from you. For the first time perhaps in a very long time, you will finally be able to breathe and feel human again.
If you are able to pay a certain amount each month, you may also qualify for Chapter 13 debt consolidation to significantly reduce your monthly debt payments. In most cases, credit card payments can be reduced to half (or less) of what you currently pay. You will also pay 0% interest on your credit cards and get out of debt anywhere from 3-5 years, depending on how long your plan is in Chapter 13. If you are in foreclosure, Chapter 13 can also help. you save your home and help you bring your payments to the present.
If you are in debt and need to find the best solution for your situation, call toll-free 1-866-477-7772 to schedule a free consultation.
NOTE: Due to the COVID-19 pandemic, I am offering free consultations OVER THE PHONE to anyone who needs help dealing with their debt problems.
None of the information here is intended to provide legal advice for any particular situation. Atty. Ray Bulaon has successfully helped more than 5,000 clients get out of debt. For a free attorney review of your situation, please call RJB Law Offices at TOLL FREE 1-866-477-7772.