Articles

Practice Areas

Michigan bankruptcy rates jump in 2014

If you are struggling to make ends meet in Michigan, you are not alone. Recent statistics from the United States Bankruptcy Courts report 2,570 petitions for bankruptcy relief in Michigan were granted in January, an additional 3,285 were granted in February and 4,099 in March of 2014. Almost 10,000 Michiganders have sought assistance through bankruptcy, and the number appears to be increasing each month.

Financial experts note that there are some warning signs that could help individuals notice that their finances are in trouble. These warning signs include:

  • Fees. It may be a good idea to take a closer look at your financial situation if late or overdraft fees are a common occurrence, particularly if payments are not made on time because they are unaffordable.
  • Credit cards. Credit cards can be a great tool to increase financial security, if used wisely. Ideally, credit cards should be paid off every month. This lets the carrier have the peace of mind of not needing to carry around cash and the added benefit of earning rewards. Consider it a red flag if you are only able to make the minimum payments every month.
  • Lack of savings. No savings can mean big problems in the future. True financial stability, according to financial experts with Bankrate, requires not only a savings account for emergencies but also setting aside money in a retirement account.
  • Dipping into retirement or depending on home equity. Taking money out of retirement more than once to cover expenses or taking out a home equity loan for unnecessary expenses like a vacation are both warning signs that financial help may be needed.

Thankfully, financial help is available in a variety of forms. For those facing foreclosure due to the inability to make home loan payments a restructured loan may be an option. Bankruptcy may also be an option and can offer a fresh financial start. Essentially, bankruptcy uses available funds to pay off debts and removes the recipient’s obligation to pay off what remains. There are many forms of bankruptcy; a legal professional can help you decide which is best for your situation.

Although helpful, a petition for relief through bankruptcy should not be taken lightly. Those who are struggling financially should note that they are not alone. As the statistics above show, many Michiganders are facing similar frustrations. If you are considering bankruptcy, seek the counsel of an experienced bankruptcy attorney. This legal professional can review your situation and help guide you on a path that will lead to future financial stability.