Over the past few years most Americans have heard of all the bailouts that banks are getting. Even going further than that the federal government came up with a stimulus package to supposedly stimulate the economy but all it did was give the money to large corporations for their pet projects without creating any jobs at all. Right now in 2011, the US still has an employment rate of 9.2% nationwide. That doesn't seem like the economic stimulus did anything for the citizens of the United States. Most Americans are buried under a mountain of credit card debt, waiting for a job so they don't have to file for bankruptcy. In most cases, if these individuals wait too long, filing bankruptcy won't even help.
When it comes to debt, the statistics speak for themselves, the average American household has $20,000 in credit card debt. That's a lot of money when you consider that $20,000 is also six months salary of the average American household. Most individuals don't realize that they will probably never be able to pay this debt down. With interest rates up around 21 to 26% for credit cards, people in this situation usually can barely make the minimum payment. This is why filing bankruptcy might be the only economic stimulation that these folks will ever get. This federal government does a lot of talking, but when it comes down to it they're not paying your bills.
It's only common sense to take a look at your finances and see that unless you win the lotto you'll never be able to pay this off. All you have to do is write down all your bills to create a budget and figure out if you never charged on the credit cards ever again how long would it take you to pay them off. If it's over six years, the odds are against you. When you're facing this kind of situation it's time to go speak with a bankruptcy attorney to see if bankruptcy can help your current situation.
There are two main chapters of bankruptcy for individuals. These are Chapter 7 and Chapter 13 bankruptcy. Chapter 7 bankruptcy is the most common and is king for an individual or family that has a large amount of unsecured debts like credit cards, medical bills and payday loans. Filing Chapter 7 bankruptcy will wipe out all of these debts and if the debtor has no secured debts there is a chance that they will come out of bankruptcy being debt free. This sounds like a pretty good stimulus package if you ask me. On the other side of the fence, Chapter 13 bankruptcy is best for people who are trying to protect their property from being lost to foreclosure. In a Chapter 13, the debtor has their bankruptcy attorney create a repayment plan that will last 3 to 5 years. The Chapter 13 payment plan is based on the amount the debtor can afford with secured debts being paid for and all others be paid if something is left over. A Chapter 13 bankruptcy allows the debtor to keep their property while getting caught up on back payments.
The beautiful thing about bankruptcy is once the bankruptcy attorney files a petition with the court, the creditors can no longer bother the debtor's to collect on the amount owed. People that are struggling paycheck to paycheck and in many cases unemployment check to unemployment check to get by, don't need extra pressure from nasty creditors demeaning them. Don't wait for economic stimulus from the government to rescue you, bankruptcy might be the only boost you'll ever get.
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